FxWirePro: NZD/USD extends break above 5-DMA, bias higher

Chart - Courtesy Trading View 

Spot Analysis:

NZD/USD was trading 0.75% higher on the day at 0.6172 at around 08:00 GMT

Previous Week's High/ Low: 0.6129/ 0.5840

Previous Session's High/ Low: 0.6167/ 0.6064

Fundamental Overview:

Stubbornly high inflation expectations stoke expectations of aggressive rate hikes from the Reserve Bank of New Zealand (RBNZ).

Data from the US on Thursday showed Philadelphia Fed Manufacturing Index fell to -19.4 versus -6.2 market forecasts and -8.7 prior. 

Housing Starts declined by 4.2% MoM in October following September's 1.3% contraction whereas Building Permits fell by 2.4%, compared to a 1.4% increase recorded in the previous month. 

Further, the Jobless Claims eased to 222K for the week ended on November 11 versus 225K expected and upwardly revised 226K prior.

Also, fresh tensions between Russia and Ukraine after missile strikes on Poland, as well as the increasing Covid cases in China underpin the US Dollar’s safe-haven demand.

Technical Analysis:

- Price action is extending break above 110-EMA and daily cloud

- Momentum is bullish and volatility is high and rising

- The pair is trading above daily cloud and Chikou span is biased higher

- GMMA indicator shows minor trend is bullish, major trend is turning bullish

Major Support and Resistance Levels:

Support - 0.6044 (110-EMA), Resistance - 0.6308 (200-DMA)

Summary: NZD/USD trades with a bullish bias. The pair is poised to test 200-DMA at 0.6308.