- NZD/USD has sharply dived below 0.6020 amid mixed China’s Official PMI data.
- China’s Manufacturing PMI at 48.8, lower than the estimates of 49.4 while Non-Manufacturing PMI jumped to 54.5 vs. 50.7.
- NZD/USD has formed a Bullish Divergence which indicates exhaustion in the downside momentum.
The NZD/USD pair has tumbled to near 0.6016 after the release of mixed China’s official PMI data (May). China’s National Bureau of Statistics (NBS) has reported Manufacturing PMI at 48.8, lower than the estimates of 49.4 and the former release of 49.2. While Non-Manufacturing PMI jumped to 54.5 from the consensus of 50.7 but remained lower than the former figure of 56.4.
The US Dollar Index (DXY) has extended its retreat move further below 104.04 as an approval of a raise in the US debt-ceiling has weakened its appeal. Going forward, the USD Index will be guided by the release of the US Automatic Data Processing (ADP) Employment Change data.
Going forward, New Zealand Dollar will continue its action ahead of the release of the Caixin Manufacturing PMI data (May). As per the consensus, the economic data is seen steady at 49.5. It is worth noting that New Zealand is one of the leading trading partners of China and a stagnant China's factory performance could impact the New Zealand Dollar.
NZD/USD has formed a Bullish Divergence on a two-hour scale, which indicates exhaustion in the downside momentum. The Kiwi asset was consistently making lower lows while the momentum oscillator Relative Strength Index (RSI) (14) made higher lows. The bullish divergence would get triggered after a decisive break above the crucial resistance of 0.6070.
The 20-period Exponential Moving Average (EMA) at 0.6048 is still acting as a barricade for the New Zealand Dollar bulls.
A confident break above the immediate resistance of 0.6070 will drive the Kiwi asset toward the horizontal resistance plotted from May 25 high at 0.6110 followed by May 01 low at 0.6160.
On the flip side, a downside move below the intraday low at 0.6015 will expose the asset for a fresh six-month low toward 11 November 2022 low at 0.5984. A slippage below the latter would expose the asset toward 02 November 2022 high at 0.5941.
NZD/USD two-hour chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD: The hunt for the 0.7000 hurdle
AUD/USD quickly left behind Wednesday’s strong pullback and rose markedly past the 0.6900 barrier on Thursday, boosted by news of fresh stimulus in China as well as renewed weakness in the US Dollar.
EUR/USD rebounds on Thursday after midweek pullback
EUR/USD tuned back into the high end on Thursday, getting bolstered by a broad-market selloff in the Greenback. US data that printed better than expected helped to ease concerns of a possible economic slowdown within the US economy looming over the horizon.
Gold holding at higher ground at around $2,670
Gold breaks to new high of $2,673 on Thursday. Falling interest rates globally, intensifying geopolitical conflicts and heightened Fed easing bets are the main factors.
Ethereum investors show bullish bias amid ETF inflows and positive funding rates, exchange reserves pose risk
Ethereum traded around $2,640 on Thursday, up more than 2% following increased bullish bias among investors, as evidenced by ETH ETF net inflows and an uptrend in funding rates. However, investors may be wary of a potential correction from ETH's rising exchange reserve.
RBA widely expected to keep key interest rate unchanged amid persisting price pressures
The Reserve Bank of Australia is likely to continue bucking the trend adopted by major central banks of the dovish policy pivot, opting to maintain the policy for the seventh consecutive meeting on Tuesday.
Five best Forex brokers in 2024
VERIFIED Choosing the best Forex broker in 2024 requires careful consideration of certain essential factors. With the wide array of options available, it is crucial to find a broker that aligns with your trading style, experience level, and financial goals.