NZD/USD consolidates in a range above 0.73 handle, US data awaited
After yesterday's volatile swing, the NZD/USD pair has entered a consolidation phase and oscillated in a 20-pips narrow trading range above the 0.7300 handle.
On Thursday, the spiked back closer to yearly tops, near the 0.7370 region, but quickly faded around 50-pips in wake of a sharp upsurge in the US Treasury bond yields post US economic data.
Bulls on Friday seemed unimpressed by the release of Business NZ Manufacturing Index, at 56.2 vs prior 58.5, which did little to provide any fresh bullish impetus. Meanwhile, a modest retracement in the US bond yields and subdued US Dollar action was seen lending some support to higher-yielding currencies - like the Kiwi.
The pair, however, struggled to gain any strong follow through traction as investors refrained from placing aggressive bets ahead of the key US macro data - monthly retail sales and inflation figures, which could influence Fed rate hike expectations and determine the next leg of directional move for the major.
Technical levels to watch
On a sustained move beyond 0.7330-40 area, the pair could aim back towards yearly tops resistance near 0.7370-75 region before eventually darting towards the 0.7400 handle. On the downside, weakness below the 0.7300 handle, leading to a subsequent drop below 0.7275 horizontal support, could trigger a corrective slide back towards the 0.7225-20 support area.
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