200-SMA pullback despite firmer Chinese GDP

  • NZD/USD retreats from its two-week high even as China’s Q3 GDP grew better than expected.
  • MACD signals, the bounce off a week-old rising trend line favor buyers.
  • The one-month horizontal resistance acts as additional filters to the north.

NZD/USD fails to justify the bullish data from China as it drops to 0.5745 while extending the early week pullback from the 12-day high in Monday’s Asian session.

Also read: Chinese GDP (YoY) Q3: 3.9% (exp 3.3% vs. prev 0.4%), the Aussie remains volatile

In doing so, the Kiwi pair pulls back from the 200-SMA and ignores bullish MACD signals.

With that, the further decline in the quote becomes questionable unless it breaks the 1-week support line around 0.5675 at press time.

Following this, a bearish trajectory towards the refresh of the yearly low near 0.5510 cannot be ruled out.

It should be noted that NZD/USD weakness above 0.5510 needs to be validated from the 0.5500 threshold and the 2020 low around 0.5470 to keep the bears on hold. table.

Alternatively, recovery moves will initially need to clear the 200-SMA hurdle near 0.5780 to win over intraday buyers before challenging a month-old horizontal resistance zone around 0.5805-10.

If the Kiwi bulls manage to hold the reins above 0.5810, the quote may aim for the psychological magnet of 0.6000 and the previous monthly high around 0.6165.

Overall, NZD/USD remains on the short-term seller’s radar, but the downside seems limited.

NZD/USD: four-hour chart

Trend: Limited decline expected

Eleanor C. William