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  • NZD/USD remains on the back foot for the third consecutive day.
  • Clues that the US may be willing to delay tariffs aren’t enough to please trade watchers.
  • A lack of economics from NZ will keep the focus on offshore events, trade headlines.

NZD/USD extends losses to the third consecutive day as traders keep struggling amid mixed messages concerning the phase one deal. The kiwi pair takes rounds to 0.6400 at the start of Friday’s Asian session.

The South China Morning Post (SCMP) news that the United States (US) may delay further tariff increase on Chinese goods that will go in effect on December 15 recently triggered risk-on sentiment. However, the moves were compressed by statements from the Global Times (GT) editor Hu Xijin, who kept criticizing the US trade strategy while saying, “The US has the upper hand in US-China trade war, which allows it to decide when to end the trade war, but far from enough for it to decide how to end the trade war. The US side wants both, then it needs to change an adversary.”

Previously, China turned red on the US after knowing that the US Congress passed the Hong Kong bill that is now on the President Donald Trump’s table for a sign. At the same time, SCMP cited a Chinese source saying Beijing may decide to “fight and talk alternatively” and is now closely monitoring the US president’s next move following the vote by Congress.

On the data front, a weaker than expected 5.5% Credit Card Spending from New Zealand (NZ) to 2.5% added downside pressure on the kiwi. Elsewhere, the US economic calendar flashed mixed numbers of housing and manufacturing catalysts.

While an absence of major data at home will shift the market’s attention to the US activity numbers, as far as the economic calendar is concerned, trade/political headlines concerning the US and China will keep being the key driver.

Technical Analysis

Sellers cheer the pair’s failure to cross 100-day Exponential Moving Average (EMA), at 0.6427 now, but their joy might soon be challenged by the 0.6383/79 region comprising 21 and 50-day EMA.