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  • Kiwi traders are in usual Monday morning mood with few catalysts to follow.
  • The USD continued bearing the burden of soft data and risk-off sentiment.

NZD/USD begins the week’s trading around 0.6850 at Asian markets on early Monday. Traders remain calm awaiting additional support from the US-China trade deal and/or economic data in order to accelerate the movement. However, overall sentiment remained against the US Dollar considering a recent weakness in the US data and risk-off mood.

Lack of fresh directives pushes traders to carry their previous bias against the US Dollar during early day sessions. The US Dollar stretched its downward trajectory on Friday as weaker than forecast NY empire state manufacturing index and industrial production from the US kept weighing on the greenback. The March month NY empire state manufacturing index fell behind 10.00 forecast and 8.8 prior to 3.7 whereas industrial production growth for the February month lagged past 0.4% market consensus to 0.1% compared to upwardly revised -0.4% previous.

At the trade discussion front, latest criticism to China’s human rights violations from the top-tier US lawmakers and delaying of the Trump-Xi meet from previously predicted in March to April signal, not all is going well there. As a result, traders turned to trim their risk assets including the USD.

Additionally, politics at the US is also generating interest as lawmakers, including 12 Republicans, challenged the US President Donald Trump’s US-Mexico border wall. Mr. Trump retaliated by using his veto power to turn down the resolution and hence Congress will now need more than two-thirds of support to go ahead with their wish.

Looking forward, monthly release of the US NAHB housing market index for March and a quarterly outcome of New Zealand Westpac consumer survey are likely important data to follow. The US housing market may print 63 number against 62 while New Zealand’s consumer sentiment gauge was up to 109.1 during Q4 2018 and can boost Kiwi traders’ sentiment of holding the strength.

NZD/USD Technical Analysis

While a downward sloping trend-line stretched since February beginning can limit the NZD/USD pair’s upside near 0.6845-50, a break of which might not hesitate to fuel the quote towards breaking 0.6900 round-figure.

Alternatively, 0.6800 and 100-day simple moving average (SMA) near 0.6785 could confine immediate downside.