NZD/USD: 200-day MA hurdle cleared ahead of China data

• The NZD/USD pair cleared the 200-day MA resistance on Friday.
• Benign US inflation data released on Friday reaffirmed dovish Fed expectations.
• A drop in China's trade surplus with the US could put a strong bid under the NZD.

The NZD/USD has cleared the 200-day moving average (DMA) hurdle ahead of the China trade data release.

Notably, the currency pair saw its first daily close above the long-term MA for four weeks on Friday, as the sharp gains in the offshore Chinese yuan (CNH) triggered a broad-based sell-off in the USD.

Further, benign US inflation data reaffirmed expectations that the Fed would rein in rate hikes and helped the NZD/USD pair convincingly cross the 200-day MA resistance.

The bullish breakout has shifted focus to the next resistance lined up at 0.6880 (Dec. 12 high). That level could be put to test later today if China trade data shows a drop in surplus with the world's largest economy. Moreover, that would allay trade war fears.

NZD/USD Technical Levels