NZD/USD extends previous session’s rejection move from 50-DMA

The NZD/USD pair extended previous session's reversal move from the 50-day SMA hurdle and has now slipped below the key 0.70 psychological mark.

On Monday, the pair failed to build on French election-led weekly bullish gap and faced some fresh supply at higher levels. A follow through recovery in the US treasury bond yields, led by renewed optimism over the US President Donald Trump's tax cut plans, helped the US Dollar Index to recover back above 99.00 mark and was seen weighing on higher-yielding currencies - like the Kiwi. 

From a technical perspective, the pair is currently placed closer to its immediate support near 0.6980 level and hence, a follow through selling pressure would confirm a rejection from 50-day SMA resistance, eventually turning the pair vulnerable to extend its depreciating move in the near-term.

On the economic data front, today's release of CB Consumer Confidence Index and new home sales data from the US would now be looked upon for some fresh impetus during early NA session.

Technical levels to watch

On a sustained break below 0.6980 level, the pair is likely to accelerate the downslide towards 0.6955 horizontal support before heading towards its next support near 0.6920-15 zone. 

Meanwhile on the upside, any recovery attempts back above 0.70-0.7010 area could boost the pair towards 50-day SMA strong resistance near mid-0.7000s, which if conquered might trigger a short-covering rally towards 0.7075 region (100-day SMA) ahead of the 0.7100 handle.