The New Zealand Dollar is the star of today’s trading so far as more positive news emanates from the US-China trade front. The newswires were agog today with news that the US and China have agreed on a “phased rollback” of all tariffs. As at the time of writing, the NZDUSD is trading at 0.63722, after having touched off intraday highs at the 0.63854 resistance level.
NZDUSD Benefits from US-China Trade Optimism
The NZDUSD is benefitting from trade optimism that arose from the announcement by the Chinese Commerce Ministry on the phased rollback of tariffs. According to the statement by the ministry, “If China and the US reach a Phase 1 trade deal, both sides must cancel existing tariffs at the same time, in the same proportion based on the agreement.”
In addition, the Chinese news outlet Xinhua is reporting that China is mulling a removal of restrictions on the import of US poultry products.
NZDUSD Technical Outlook
The positive US-China trade news has pushed the NZDUSD to as high as 0.63854 (R1 pivot on the day as well as cluster of early November highs), but the pair has retreated from this resistance level.
The upside targets above 0.63854 are 0.64122 (October 21 high and R2 pivot) as well as 0.64322 (October 31 high). Price has to break above 0.63854 with a decisive close for these upside targets to be reached.
To the downside, 0.63418 (S2 pivot) remains the strongest near-term support (cluster of lows between October 28 – 30), after which 0.63243 (S3 pivot and October 8/9 highs) becomes relevant if downside pressure is strong enough.