FxWirePro: NZD/USD erases early gains, break below trendline support (0.7130) to drag the pair lower

NZD/USD chart - Trading View 

NZD/USD was trading 0.08% lower on the day at 0.7131 at around 10:30 GMT, bias bearish.

The major has erased early gains as price action slips lower from session highs at 0.7160.

Technical bias for the pair has turned lower and risk-off market sentiment ahead of the key FOMC policy meeting dents the antipodeans.

Robust economic data raises scope for FOMC to resort to monetary policy normalization sooner than expected. 

US Retail Sales due today at 12:30 PM GMT will be the key ahead of Wednesday’s FOMC. Retail Sales in the US is expected to contract modestly in May.

Retail Sales are expected to decline by 0.4% on a monthly basis after staying unchanged at $619.9 billion in April.

Support levels - 0.7130 (Trendline), 0.71 (Lower BB), 0.7029 (200-DMA)

Resistance levels - 0.7153 (5-DMA), 0.7183 (55-EMA), 0.7203 (20-DMA)

Summary: Any positive surprise in the Retail Sales reading is likely to provide a boost to the greenback, dragging the pair lower.

Upside remains capped at 5-DMA and Daily cloud, breach below trendline support at 0.7130 will drag the pair lower. Next major support lies at 200-DMA at 0.7029.