FxWirePro: NZD/USD breaks above 110-EMA as US Dollar resumes its post-CPI downside

Chart - Courtesy Trading View 

Spot Analysis:

NZD/USD was trading 1.31% higher on the day at 0.6100 at around 15:55 GMT.

Previous Week's High/ Low: 0.5941/ 0.5740

Previous Session's High/ Low: 0.6040/ 0.5840

Fundamental Overview:

Data released on Thursday showed the US Consumer Price Index (CPI) for October declined to 7.7% YoY, the lowest since last March, versus 8.0% expected and 8.2% prior. 

More importantly, the Core CPI fell to 6.3% compared to 6.5% market forecasts and 6.6% previous readings.

Fall in October inflation numbers have raised the scope for an easy Fed rate hike in December, depressing the dollar across the board.

The safe-haven US Dollar resumes its post-CPI downside as risk flows continue to dominate the financial markets ahead of the weekend.

Sunday’s meeting between US President Joe Biden and Japan’s Prime Minister (PM) Fumio Kishida will be watched for further impetus.

Technical Analysis:

- NZD/USD has broken above 110-EMA resistance

- Momentum is bullish, Stochs and RSI are  biased higher

- MACD and ADX support upside in the pair

- Price action has edged above daily cloud

Major Support and Resistance Levels:

Support - 0.6035 (110-EMA), Resistance - 0.6321 (200-DMA)

Summary: NZD/USD trades with a bullish bias. The pair is poised for further gains, scope for test of 200-DMA at 0.6321.