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NZD/USD Price Analysis: Eases from 10-day SMA following downbeat China data

  • NZD/USD recedes from 0.6647 after China’s Caixin Services PMI slipped below forecast and prior in July.
  • Bulls remain hopeful unless the quote slips below an ascending trend line from March 19.
  • December 2019 top could challenge buyers beyond 0.6700.

NZD/USD steps back from 0.6647 to currently around 0.6635 during the early trading on Wednesday. The kiwi pair recently took clues from downbeat China Caixin Services PMI to trim the early-day gains. Even so, the pair remains on the bulls’ radars until it breaks a medium-term support line.

Caixin Services PMI from the dragon nation came in below expectations to 54.1 in July versus 56.8 market consensus and 58.4 previous readouts.

Read: China’s Caixin/Markit services PMI: 54.1 vs 56.8 expected

Even if 10-day SMA played its role of an immediate resistance following the data, the pair stays beyond the key support line while extending the previous day’s upside momentum, which in turn pushes it towards 0.6700 mark.

During the quote’s further rise beyond 0.6700, the July month’s peak of 0.6716 and December 2019 high surrounding 0.6755/60 could lure the optimists. However, likely overbought conditions may trigger the pair’s pullback around then.

On the flip side, the weekly bottom of 0.6613 and a multi-week-old ascending trend line, at 0.6540 now, could keep the pair’s near-term downside limited.

In a case where the NZD/USD prices decline below 0.6540, 0.6500 may offer an intermediate halt ahead of diverting the bears to the previous month’s low near 0.6440.

NZD/USD daily chart

Trend: Bullish

 

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