NZDUSD – Can New Zealand Dollar Break 0.7040 Resistance?
- The New Zealand dollar managed to climb higher recently against the US Dollar, but faced sellers near 0.7040.
- There is an expanding triangle pattern formed on the 4-hours chart of NZDUSD with resistance near 0.7040.
- Today in China, the Consumer Price Index released by the National Bureau of Statistics of China posted a rise of 0.2% in Dec 2016, compared with the forecast of +0.3%.
- In terms of the yearly change, the Chinese CPI came in at +2.1%, compared with the forecast of +2.3%.
NZDUSD Technical Analysis
The New Zealand Dollar recently started an upside move from the 0.6884 low against the US Dollar. The NZDUSD pair is currently trading positive, but facing a major resistance near 0.7040.
The main reason for the 0.7040 acting as a major hurdle is the fact that the 200 simple moving average on the 4-hours chart is positioned near the stated level. Moreover, there is an expanding triangle pattern formed on the 4-hours chart of NZDUSD. Its resistance is also around the same area.
There were 2-3 failure already to break the 0.7040 resistance. The pair recently declined as a result, but found support near the 100 simple moving average (H4). Once there is a break above the 200 simple moving average or 0.7040, there can be more upsides in the near term.
Chinese Consumer Price Index
Earlier during the Asian session, the Chinese Consumer Price Index was released by the National Bureau of Statistics of China. The market was expecting a 0.3% rise in Dec 2016 in the retail price variations within a representative basket of goods and services, compared with the previous month.
The result was on the lower side, as the Chinese CPI in Dec 2016 increased 0.2%. In terms of the yearly change, the Chinese CPI posted an increase of 2.1%, which was on the lower side compared with the forecast of +2.3%.
Overall, the result was not encouraging and failed to help the risk sentiment. It also decreased the chances of an upside break in NZDUSD above 0.7040 in the short term. Let us wait for the next couple of sessions, and see how the pair trades. On the downside, a major support is seen at 0.6980.