NZD/USD continues its upward momentum beyond 0.6050, with attention shifting to US PMI data.
FUNDAMENTAL OVERVIEW:
- NZD/USD gains support from positive Kiwi Retail Sales data.
- The market sentiment receives a lift from China’s new stimulus plan.
- An uptick in US Treasury yields might bolster the US Dollar.
For the second consecutive session, NZD/USD is on an upward trajectory, hovering around 0.6060 in the European session on Friday. The Kiwi pair is fuelled by the surprisingly positive New Zealand Retail Sales data, revealing unexpected stability with a flat 0.0% reading in the third quarter of 2023. Market projections had anticipated a 0.8% decrease in the headline figure.
Moreover, Retail Sales excluding automobiles exceeded consensus predictions, contradicting expectations of a 1.5% decline and instead registering a 1.0% increase during the mentioned period. This favorable outcome acts as a supportive factor for the NZD/USD pair.
The anticipation of a fresh Chinese stimulus initiative has uplifted market sentiment. Indications point to Chinese authorities including Country Garden Holdings Co in a roster of 50 eligible property developers with financing access. Positive shifts in China can impact currencies like the NZD, known for their sensitivity to the Chinese economy.
Furthermore, the FOMC minutes revealed a hawkish stance on Tuesday, and positive US labor market and consumer sentiment data on Wednesday are deterring bears from initiating new bets against the USD. Consequently, this presents a challenge for the NZD/USD pair.
NZD/USD TECHNICAL ANALYSIS DAILY CHART:
Technical Overview
NZD/USD is currently trading within an up channel.
NZD/USD is positioned above all Moving Averages (SMA).
The Relative Strength Index (RSI) is in the buying zone, while the Stochastic oscillator suggests a neutral trend.
Immediate Resistance level: 0.6085
Immediate support level: 0.6045
HOW TO TRADE NZD/USD
Following a notable ascent, NZD/USD experienced a decline before entering a consolidation phase. Subsequently, it broke down and traded in a downward direction until it reached a support level, prompting a reversal to the upside. Presently, the price is situated at a crucial resistance zone, and a potential breach of this zone could lead to further upward movement.
TRADE SUGGESTION- STOP BUY – 0.6107, TAKE PROFIT AT- 0.6195, SL AT- 0.6054.