- NZD/USD fails to cheer the latest positive headlines from the US and China, BusinessNZ PMI data.
- The pair benefited from the RBNZ’s surprise no rate cut.
- An absence of major data keeps the market’s attention on trade news for fresh impulse.
NZD/USD buyers seem to catch a breath as the pair shows a little positive response to the latest slew of US-China trade headlines. The quote seesaws around 0.6400 by the press time of early Monday morning in Asia.
Trade talks between the United States (US) and China are in their final stages to mark the “phase one” completion. The latest media reports from the US and China are both supportive of the arguments as not only the Trump administration but officials from the dragon nation also are positive to the last round of phone calls held on Friday. Though, no clear deadline, as to when the initial deal will be signed, is yet available from any of the sides.
On the data front, New Zealand’s Business NZ Services Purchasing Managers Index (PMI) for October rose to 55.4 from 54.4 prior.
The kiwi pair turns out to become the best G10 currency pair by the end of last week. The same can be attributed to the Reserve Bank of New Zealand’s (RBNZ) surprise no rate cut. It should, however, be noted that the central bank Governor Adrian Orr kept the door open for further easing if needed.
In spite of the overall trade positive sentiment, the kiwi traders seem to await strong clues of trade progress, might the phase one deal announcement, to extend the latest run-up. Adding to this could be the lack of data on the economic calendar. Furthermore, the escalation of protests in Hong Kong could also be considered as a negative catalyst.
Technical Analysis
Prices stay below 100-day Exponential Moving Average (EMA) level of 0.6427 while holding above the 21-day EMA, around 0.6370. As a result, traders will look for a clear break to register a major move.
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