NZD/USD: China’s official PMIs help chart a gap-up opening, Caixin data awaited

• NZD/USD begins the week’s trading with an upside gap of 12 pips.
• China’s official manufacturing PMI, released over the weekend, surged to the highest since April.
• The US-China tussle keeps mum over China’s actual retaliation, phase-one deal.

NZD/USD takes the bids to 0.6432 at the start of the week’s Asian trading session on Monday. That said, the pair marks an upside gap of 12 pips while responding to the latest recovery in China’s activity numbers.

China’s November month Purchasing Manager Index (PMI) numbers for Manufacturing and Non-Manufacturing activities seem to please the kiwi buyers at the moment as the headlines Manufacturing PMI rose to the highest since April while Non-Manufacturing PMI also came in upbeat. The Manufacturing PMI crossed the 50.0 mark and posted an expansionary figure of 50.0, the highest since April, whereas Non-Manufacturing PMI printed at 54.4 was much better than the previous 52.8.

On the other hand, China’s readiness to retaliate over the United States (US) passage of the Hong Kong Act couldn’t accompany the exact measures. Also, talks that the phase-one deal negotiations will not be affected by the political tension gives traders a state of intermediate peace. However, planned tariffs from the US, proposed for December 15, are yet not withdrawn by the Trump administration and hence keep the tension high.

While US-China headlines are likely to remain in focus, China’s Caixin Manufacturing PMI for November, expected 51.4 versus 51.7, will also be observed closely after the official numbers’ upbeat performance. “The Reserve Bank of New Zealand (RBNZ) decision on capital will be the domestic focus for the kiwi this week, with offshore events still in the hot seat otherwise,” says the Australia and New Zealand Banking Group (ANZ).

Technical Analysis

November top surrounding 0.6470 exerts the downside pressure on the quote to revisit the 50-day Exponential Moving Average (EMA) level around 0.6390. However, a fresh high beyond 0.6470 opens the gate for 200-day EMA near 0.6515.