NZD/USD consolidates recent gains to over 1-month tops, comfortable above 0.6400 handle

The NZD/USD pair was seen oscillating in a narrow trading band, comfortably above the 0.6400 handle, and consolidated the recent strong gains to over  |  22/10/2019 08:44
  • Continues gaining traction for the fourth consecutive session on Tuesday.
  • Positive trade-related developments benefitted perceived riskier currencies.
  • Fed rate cut expectations kept the USD depressed and remained supportive.

The NZD/USD pair was seen oscillating in a narrow trading band, comfortably above the 0.6400 handle, and consolidated the recent strong gains to over one-month tops.
 
The pair continued gaining some follow-through traction for the fourth consecutive session on Tuesday and added to its recent goodish recovery move from multi-year tops amid positive trade-related news-flow, which benefitted perceived riskier currencies like the Kiwi.

Trade optimism/subdued USD demand supportive

The US President Donald Trump on Monday said that he hopes to sign a trade deal with China at the Chile APEC summit, scheduled next November, and White House adviser Larry Kudlow said that tariffs planned for December could be withdrawn if progress is made.
 
The latest developments raised optimism about a possible resolution of the prolonged US-China trade disputes, which coupled with a subdued US Dollar price action – despite a positive tone surrounding the US Treasury bond yields – remained supportive of the move up.
 
It will now be interesting to see if bulls are able to maintain their dominant position or opt to take some profits off the table amid absent relevant market-moving US economic releases on Tuesday.

Technical levels to watch

 

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