NZD/USD on bids for second straight session, still capped below 100-DMA

The NZD/USD pair traded with mild positive bias for the second consecutive session and built on its modest recovery move from the very important 200-day SMA support.

The pair benefitted from persistent weaker sentiment surrounding the US Dollar, which remained on the back-foot in wake of Friday's dismal US monthly jobs report and escalating North Korean crisis. 

Meanwhile, the prevalent risk-off environment continued driving investors towards traditional safe-haven assets, including Treasuries. Hence, a sharp slide in the US bond yields added to the greenback's woes and underpinned demand for higher-yielding currencies - like the Kiwi.

On the economic data front, today's better-than-expected China Caixin Services PMI for August provided an additional boost to commodity-linked currencies, including the NZD. 

Bulls, however, seemed lacking conviction and the up-move remained capped below 100-day SMA hurdle as traders now look forward to the release of NZ GDT price index for some fresh impetus. Traders would also take clues from the US factory orders data and speeches from various Fed officials.

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Technical levels to watch

A clear break through 100-DMA hurdle near the 0.7180-85 region is likely to lift the pair beyond the 0.7200 handle and 0.7210 intermediate resistance towards its next barrier near the 0.7250-55 region.

Alternatively, reversal from current resistance, and a subsequent drop break through 200-DMA support, around the 0.7135-30 region, would turn the pair vulnerable to break below the 0.7100 handle and dart towards 0.7055-50 horizontal support.