NZD/USD testing last week’s highs at 0.7323 as the USD is under pressure
- The US Dollar is on the backfoot with the threat of China devaluing its national currency, the Yuan.
- The NZD/USD bulls have taken the lead on Monday and lifted the pair to last week’s highs.
The NZD/USD is trading at around 0.7319 up 0.68% on Monday. The NZD/USD is gaining some steam as the US Dollar is on the backfoot while tensions over trade tariffs between the US and China are still on the table and the worst-than-expected Non-Farm Payroll last Friday greatly disappointed the FX market and especially US Dollar bulls. Adding pressure to the US Dollar is Beijing announcing they are considering devaluing the Chinese yuan in order to gain a commercial advantage amid trade wars.
Later in the day, the NZIER Business Confidence will release its data for the first quarter of 2018, in New-Zealand. The news shouldn't be a market-mover.
Meanwhile, on Wednesday the FOMC will release its Minutes at 18:00 GMT.
NZD/USD weekly chart
The NZD/USD is trading above its 50, 100 and 200-period simple moving averages. The bulls are breaking out of a wedge bull flag which started forming early 2018. The market is testing 0.7323 (last week’s high).
NZD/USD daily chart
The NZD/ USD on the daily time frame is rejecting the 50-period simple moving average and the bulls are gathering some good momentum. The bulls’ objective is to push above 0.7323, last week's high and reach the 0.7355 swing high and 0.7438 high of 2018. Supports are at 0.7244 and 0.7188 swing lows.
NZD/USD 4-hour chart
The NZD/USD is currently testing the 0.7323 level. Support at the 0.7244 swing low is further confirmed with the 100-period simple moving average creating a confluence of technical factors at the level.