Could the Weekly Data Break the NZD/USD Range?

Later this evening around midnight New Zealand will publish quarterly Retail sales report.The New Zealand Dollar traded mostly flat last week as investors seemed to shrug off the latest developments over the trade deal. Following the Reserve Bank of New Zealand’s surprise decision to keep monetary policy unchanged at its last meeting, the data will be watched for clues as to whether additional rate cuts are likely in the near-term.

If the upcoming data tips the balance more in favor of another rate cut, the kiwi will be unable to break past immediate resistance at around $0.6428, which is the 38.2% Fibonacci retracement of the July-October decline. Failure to clear this area would bring an end to the latest upswing and will push the kiwi back towards its 50-day SMA just above the 23.6% Fibonacci at $0.6340. A drop below this key support would lead bears focus to October’s 4-year low of $0.6204.

However, a positive Retail sales report could be the boost for NZD. The pairs needs to breakout the $0.6428 today's high and will aim for the 50% Fibonacci, which sits close to the $0.65 handle.

Kiwi traders also should be watching a speech by RBNZ Governor Orr on Wednesday and the report for ANZ Business Confidence on Thursday. Thursday is also U.S. bank holiday so expect trading volume to taper off throughout the week.

Order cancelled:

Bullish case works and the trade was closed manually at 0.6500