NZD/USD turns back below 100-DMA

Having faced rejection at 0.7200 handle on Friday, the NZD/USD pair resumed with its near-term downward trajectory on Monday and has now dipped back below 100-day SMA.

Currently trading around 0.7140 region, the greenback continues to gain traction following Friday's comments from Cleveland Fed President Loretta Mester, which reinforced market expectations of an eventual Fed rate-hike action by the end of this year and helped the US Dollar to erase disappointing NFP led minor retracement. 

Meanwhile, a relative empty economic docket and holiday thinned market liquidity conditions on Monday has failed to provide any respite for the pair and the pair has now moved within striking distance of Friday's two-month lows support near 0.7100 handle. 

Technical levels to watch

Weakness below 0.7135 (Oct. 6 low) seems to drag the pair immediately towards 0.7110 (Oct. 7 low) below which the pair might continue to drift towards 0.7075-70 support area. On the flip side, recovery back above 0.7175 (session high) might continue to confront strong resistance near 0.7200 handle, which if cleared should assist the pair to stage additional recovery towards 0.7240-45 horizontal resistance.