Ella 
NZD/USD attracted some bargain hunting in Asia on Wednesday and climbed above the psychological 0.6000 mark for the latest time. NZD/USD last hit a one-month high near 0.6015 and was choppy on mixed economic data from China.
The National Bureau of Statistics reported that China’s industrial added value above designated size increased at an annual rate of 4.6% in October, slightly better than the expected value and the previous value of 4.5%. In addition, China’s total retail sales of consumer goods increased by 7.4% at an annual rate in October. This has to a greater extent concealed disappointing fixed asset investment data. China’s urban fixed asset investment annual rate from January to October was 2.9%, while the expected and previous values were 3.1%. However, while the U.S. dollar rose slightly, Chinese economic data did not significantly boost NZD/USD.
In fact, the U.S. Dollar Index , which tracks the greenback against a basket of currencies, recouped some of its overnight losses and fell to its lowest level since September 1, which was bearish for NZD/USD. However, as more and more investors believe that the Federal Reserve’s (Fed) interest rate hike cycle is over, the dollar seems to be struggling to achieve significant gains. Weak U.S. consumer inflation data released on Tuesday triggered a sharp drop in U.S. Treasury yields, continuing to weigh on the dollar. In addition, the generally optimistic market sentiment may weaken the safe-haven function of the US dollar and promote capital flows to the riskier New Zealand dollar.
The above fundamental background indicates that NZD/USD has minimal upward resistance. Therefore, any significant consolidation or decline in NZD/USD may be seen as a long opportunity, and it remains limited. Market participants will now turn their attention to U.S. economic data, which will include producer price index (PPI), retail sales data and the Empire State manufacturing index due later in the North American morning session. These data, along with expanded U.S. bond yields and risk sentiment, could influence U.S. dollar volatility and create short-term NZD/USD trading opportunities.
