FxWirePro: NZD/USD refreshes 5-week highs, 200-DMA and channel breakout reinforces upside bias

NZD/USD chart - Trading View 

Spot Analysis:

NZD/USD was trading 0.60% higher on the day at 0.7125 at around 05:15 GMT

Previous Week's High/ Low: 0.7077/ 0.6911

Previous Session's High/ Low: 0.7105/ 0.7049

Fundamental Overview:

Kiwi tracks Australian dollar higher.

Retreating US bond yields prompted fresh USD selling and provided support to the pair.

The pair finally broke major confluence barrier at 200-DMA and channel top raising scope for further upside.

Monday's disappointing Chinese data which showed that the economic growth decelerated sharply from 7.9% to 4.9% in Q3 dents sentiment and could hamper gains.

Also, prospects for an early Fed taper might help limit any deeper USD losses and cap upside in the pair. Focus on US Housing Start, and Building Permits for impetus. 

Technical Analysis:

- NZD/USD has broken major resistance at 200-DMA and channel top

- Momentum is strongly bullish, Stochs and RSI are biased higher

- Volatility is high and rising as evidenced by widening Bollinger bands

- MACD and ADX support further upside in the pair

Major Support and Resistance Levels:

Support - 0.7097 (200-DMA), Resistance - 0.7195 (200-month MA)

Summary: NZD/USD trades with a major bullish bias. Immediate resistance is seen at 50% Fib at 0.7134. Next major resistance lies at 200-month MA at 0.7195.