NZD/USD stays directed towards 0.7300 on mixed New Zealand Trade Balance
- NZD/USD picks up bids near the highest since late March.
- New Zealand Trade Balance eases, Imports and Export gains in March.
- Fed’s rejection of tapering talks earlier pleased bulls.
- Biden’s ‘Joint Congress’, New Zealand’s ANZ sentiment figures eyed for immediate direction.
NZD/USD remains on the front foot for the second consecutive day, extending the Fed-led gains, as the bulls attack the late March tops of 0.7270, up 0.18% intraday, during the initial Asian session on Thursday. In doing so, the quote takes clues from the upbeat Imports and Exports while ignoring soft Trade Balance.
New Zealand’s headline Trade Balance eased to $33M and $1.69B respectively on MoM and YoY during March versus upwardly revised $201M and $2.38B previous readouts in that order. Further details suggest that the Imports grew beyond $4.3B to $5.65B whereas Exports also rose past $4.5B earlier readings to $5.68B during the stated month.
Although the Trade Balance eased from the previous readings, the upward revision to the priors and strong figures of Imports, as well as Exports, seem to have favored NZD/USD buyers to keep US Federal Reserve-led gains of late.
Fed matched wide market forecasts to keep the current monetary policy unchanged and stay cautiously optimistic. However, the US dollar’s drop after Chairman Jerome Powell’s backed the NZD/USD bulls afterward. Powell rejected tapering talks while saying, “It’s not the right time.”
Elsewhere, the covid woes gain momentum in Asia despite the global help whereas the uneven vaccinations also raise questions over faster economic growth.
Amid these plays, Wall Street benchmarks closed mildly red but the S&P 500 Futures print 0.06% intraday gains by the press time.
Moving on, US President Joe Biden’s first speech to the joint Congress, up for publishing at 01:00 AM GMT, will be important as it will provide details of Biden’s upcoming stimulus plan and the American view over geopolitical issues. Also crucial will be the Q1 Import and Export Price Index data from Australia. Above all, preliminary readings of the US Q1 GDP and risk catalysts hold the driver’s seat.
Read: US Q1 GDP Preview: Eyes on inflation and FOMC as economic recovery gathers steam
Technical analysis
With sustained trading beyond two-week-old support line, around 0.7200, not to forget the confluence of 50-day and 100-day SMA near 0.7155-65, NZD/USD can justify upbeat signals from Momentum, RSI and MACD to cross the late March tops near 0.7270 and eye for the 0.7300 threshold