NZDUSD trades 0.20% at 0.6515 but off the daily high after the New Zealand GDT Price Index came in at -0.5% below expectations of 0.5%. The global dairy trade auction average price registered at $3,467. The anhydrous Milk fat dropped 5.1%, the Whole Milk Powder increased by 0.1% at $3,331, while the Butter Milk Powder increased by 1.6% at $2,846.
NZDUSD gives up 12 pips on the news after the pair hit four-month highs. NZD supported by stronger Chinese manufacturing data. The China Caixin Manufacturing PMI came in at 51.8 beating expectations of 51.4 in November. The China manufacturing PMI came in at 51.8, the October reading was at 51.7.
Positive Signals from New Zealand Economy
New Zealand economy showing some improvement, the previous week the New Zealand ANZ Business Confidence came in at -26.4 beating forecasts of -30.8 for November, while the Activity Outlook came in at 12.9% beating expectations of -3.6%.
NZDUSD started a rally after the Reserve Bank of New Zealand kept interest rates unchanged in it’s latest policy meeting. Analysts now expect that Reserve Bank of New Zealand will cut the interest rates in the first quarter of 2020. If the global growth continues to be under pressure, RBNZ might proceed with an additional reduction to 0.5% during 2020.
Trade Tensions Weigh On NZDUSD
The developments in US-China trade talks have an important impact on NZDUSD; Yesterday, President Trump announced tariffs on steel and aluminium imports from Brazil and Argentina and threatened to impose tariffs on France imports as retaliation to the tax imposed by the French government on U.S. tech companies.
President Trump in a comment earlier in London said that the U.S. – China trade deal might come after the U.S. election on November 2020 and that might have negative impact on NZDUSD.
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NZDUSD Technical Levels
NZDUSD bullish momentum enhanced after yesterday the pair breached the 100-day moving average. Bulls are in control of the trend and now needs a credible break above 0.6532 the daily top and above the 200-day moving average at 0.6544. In a case of a break higher the next resistance stands at the August 7th high at 0.6557. A break above that level will be met with the supply zone at 0.6586 the high from August 6th.
On the downside, immediate support stands at the daily low (0.6493) while more buyers will emerge at 0.6411 the 100-day moving average. Sellers that will enter short positions from that level they will target the next support at the 50-day moving average at 0.6362. A warning signal for bulls is that the RSI 14 in the daily chart approaching overbought levels.More content
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