NZD/USD bulls eye 0.6920 on clearing of 100 4hr-SMA
NZD/USD has moved into a consolidation of the rally from 0.6820 in early Asia. Currently, NZD/USD is trading at 0.6881, up 0.02% on the day, having posted a daily high at 0.6896 and low at 0.6874.
NZD/USD has been in the recovery of the 9th Nov. downtrend to 0.6780 and accelerated in its trajectory today to the 100 4-hr SMA on a heap of negativity surrounding the greenback.
Greenback hit from many sides
While the dollar was taken down on the dovish FOMC minutes, it has already been on the backfoot, drifting lower from 93.94 in Asia and to 93.74 in London and then from 93.90 tops for the NY shift early. US rates were lower and US data disappointed with a big miss in US Durable Goods data. The University of Michigan survey was also in line with Yellen’s remarks, confirming that the inflation outlook remained soft and was reinforcing the gradual outlook for Fed policy.
- FOMC minutes: Participants felt an interest rate increase was warranted in near-term.
Meanwhile, retail spending eked out only a very modest gain in September, with volumes rising just 0.2%, as explained by analysts at Westpac, (Q3 real retail sales: 0.2%, (Prev: +1.8%, Westpac f/c: +0.3%, market f/c: +0.1%), Q3 real core sales: 0.5% (Prev: +1.9%)).
Daily RSI is unwinding oversold conditions while the monthly technicals are bearish pointing to a period of consolidation. Key support comes at 0.6780 while resistance is located at 0.6920 above the 100 4-hr SMA at 0.6886. 0.6980 as the 9th Nov top opens 11th Oct support level of 0.7054 as a key target.