FxWirePro: NZD/USD extends break above daily cloud, outlook bullish

Chart - Courtesy Trading View 

Spot Analysis:

NZD/USD was trading 0.30% higher on the day at 0.6420 at around 09:50 GMT

Previous Week's High/ Low: 0.6352/ 0.6212

Previous Session's High/ Low: 0.6434/ 0.6275

Fundamental Overview:

The prevalent risk-on mood turns out to be a key factor offering support to the NZD/USD pair

Weaker-than-expected US CPI report pushed back expectations for a more aggressive policy tightening by the Fed and boosted investors' confidence.

Recession fears, the overnight hawkish remarks by Fed officials could limit the USD losses and limit upside in the pair.

Going forward, major focus will be on the US Michigan Consumer Sentiment Index (CSI) data, which is due on Friday. 

The sentiment data is expected to show a consecutive improvement to 52.2 from its prior release of 51.5, after slipping to 50 for the first time in the past 20 years.

Technical Analysis:

- NZD/USD is extending previous session's gains

- Price action has broken above daily cloud

- Upside finds stiff resistance at 110-EMA

- Momentum is bullish, volatility is high and rising

Major Support and Resistance Levels:

Support - 0.6384 (cloud top), 0.6326 (5-DMA)

Resistance - 0.6427 (110-EMA), 0.65

Summary: NZD/USD poised for further upside. Watch out for break above 110-EMA for upside continuation.