NZD/USD remains stuck below 0.70 amid subdued trading action

NZD/USD records a 100-pip loss in the previous week.
DXY consolidates last Friday's gains below 95.
Westpac to release results of its New Zealand's Q2 consumer survey.

Eren Sengezer FXStreet

Amid the sharp fall witnessed on Thursday and Friday, the NZD/USD pair ended the previous week 100 pips lower and started the new week in a calm manner as investors continue to assess the potential impact of escalating trade conflicts between the United States and China. Since the beginning of the day, the pair has been moving in a narrow 20-pip band and was last seen trading at 0.6940, where it was down 0.12% on the day.

Meanwhile, the greenback is consolidating last Thursday's sharp gains against its rivals in the early week with no fundamental catalysts driving the price action.

The only data from the U.S. showed that the NAHB Housing Market Index eased to 68 in June from 70 in iğts previous reading. Underlying details of the report revealed that increasing lumber costs were weighing on the sentiment of homebuilders.

On Tuesday, Westpac New Zealand is going to release the results of its latest consumer survey for the second quarter of the year. However, unless the data shows a large diversion from the last reading of 111.2, the reaction is likely to stay limited.

Technical outlook

Despite today's uninspiring movement, the RSI indicator on the daily chart remains below the 50 mark, suggesting that seller could remain in control. 0.6925 (May 9 low) could be seen as the first technical support ahead of 0.6850 (May 16 low) and 0.6800 (psychological level). On the upside, resistances align at 0.7000 (psychological level/50-DMA), 0.7060 (Jun. 6 high) and 0.7100 (psychological level/200-DMA).

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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