FxWirePro: NZD/USD extends bounce off 200-DMA, upbeat risk sentiment and positive news surrounding China supports upside

NZD/USD chart - Trading View 

• NZD/USD is extending gains for the 2nd straight session, intraday bias higher.
   
• Upbeat risk sentiment and positive news surrounding China favor commodity-linked currencies.
   
• Riskier assets cheer the US' decision to soften its stance on China's subsidies in a bid to secure a deal next month.
   
• The pair has bounced off strong support at 200-DMA and channel base and has broken into daily cloud.
   
• RSI is biased higher and Stochs have rolled over from oversold levels. 5-DMA has also turned in support of near-term gains.
   
• The major finds stiff resistance in the 0.6784 to 0.68 zone. Break above could see further gains.
   
• Kiwi awaits next week’s inflation numbers. Weak inflation numbers could fuel RBNZ rate cut bets.
   
• The annual rate of CPI is forecast to moderate from 1.9% y/y in the fourth quarter to 1.7% in Q1. On a quarterly basis, CPI is expected to have increased by 0.3%.

Support levels - 0.6753 (5-DMA), 0.6733 (200-DMA), 0.67

Resistance levels - 0.6784 (21-EMA), 0.68 (20-DMA and 55-EMA), 0.6827 (cloud top)

Recommendation: Stay long on break above 0.68, SL: 0.6750, TP: 0.6830/ 0.6870/ 0.69

For details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.