Ella 
NZD/USD is finding some support near the all-important 200-day simple moving average (SMA) and is recovering slightly from one-and-a-half week lows, hit around 0.6080 during Monday’s Asian session. After the release of China’s macro data, NZD/USD maintained a moderate bullish bias, but lacked bullish momentum and still encountered resistance at the 0.6100 integer mark.
Data released by China’s National Bureau of Statistics (NBS) showed that China’s total retail sales of consumer goods in February reached an annual rate of 5.5%, which was expected to be 5.2% and 7.4% last month. China’s industrial added value above designated size increased by 7.0% at an annual rate in February, compared with expectations of 5.0% and 6.8% in January; China’s urban fixed asset investment in February increased by 4.2% at an annual rate – YTD. This largely overshadowed an unexpected rise in China’s unemployment rate to 5.3% in February from 5.1% previously, and provided some support to Australian and New Zealand currencies including NZD/USD.
In addition, the weakness of the US dollar has also become a factor boosting the NZD/USD. However, expectations that the Federal Reserve (Fed) will stick to a “higher for longer” interest rate policy to reduce inflation continue to boost the US dollar and prevent NZD/USD from rising. Traders may also avoid making aggressive directional bets and instead wait and see ahead of the key central bank event risk, the outcome of Wednesday’s two-day headline-grabbing Federal Reserve monetary policy meeting.
Given the above fundamental backdrop, it would be prudent to wait for strong follow-through buying before confirming that the recent pullback from the 0.6215 area (i.e. monthly highs) is over for NZD/USD. In other words, the NZD/USD seems to have ended its two-day losing streak. With no economic data released in the United States on Monday, the NZD/USD is still affected by the fluctuations of the US dollar.
