NZD/USD regains 0.7000 ahead of key risk events

The bid tone around the NZD keeps growing bigger as we progress towards the late-Asian trades, driving NZD/USD back above 0.70 handle.

NZD/USD takes-out 10-DMA at 0.7012

Currently, the NZD/USD pair advances +0.29% to 0.7015, hovering close to fresh session tops printed at 0.7019 some minutes ago. The Kiwi stalled its overnight downslide at 0.6965 levels and from there stages a solid recovery in response to improving risk sentiment as the Asian stocks witness a relief rally ahead of the Fed outcome.

Further, the bird took flight on the back of upbeat NZ current account data, while a short-covering rally ahead of Fonterra’s dairy auction results and FOMC decision cannot be ruled as the reasons behind the latest rebound.

Data-wise, New Zealand posted a larger-than-expected current account surplus in the first quarter of 2016. The current account surplus for the quarter ended March was NZD1.306 billion (US$91 million).

Next of note remains the PPI and industrial production data from the US docket, while NZ GDT price index along with the US EIA crude stockpiles report will be also closely eyed.

NZD/USD Levels to consider

To the upside, the next resistance is located at 0.7034/50 (5-DMA/ psychological level), above which it could extend gains to 0.7100/12 (round number/ daily R3). To the downside immediate support might be located at 0.7000 (June 9 Low) and from there to at 0.6943 (June 8 Low).