NZD/USD: Bears targeting 200-DMA on poor China trade?

The recovery in the NZD/USD pair lost legs near 0.7060 levels following the release of the Chinese trade data, sending the rate back towards daily lows.

NZD/USD eyes 200-DMA at 0.7012

Currently, the NZD/USD pair drops -0.24% to 0.7045, having reversed from 0.7071, daily tops. The NZD/USD pair snapped previous rebound and resumed its recent downtrend, with the renewed weakness fuelled by a massive slump in the Chinese exports, as reflected by the latest China’s trade report. China is New Zealand’s top export destination. In Yuan terms, China Sept exports slump -5.6% Y/Y versus August’s +5.9% y/y, while imports rose +2.2% y/y versus +10.8 seen previously.

Moreover, the negative tone behind the Kiwi can be also attributed to ongoing weakness in oil prices, which acts as a drag on the resource-linked NZD. While divergent monetary policy outlooks between the Fed and RBNZ, also continue to exert downward pressure on the spot.

With the Chinese data out of the way, focus now shifts towards the US unemployment claims and EIA oil inventory report for further momentum in the major.

NZD/USD Levels to consider

To the upside, the next resistance is located at 0.7095 (5-DMA), above which it could extend gains to 0.7147 (10-DMA) and from there to 0.7200 (round figure). To the downside immediate support might be located at 0.7050 (psychological levels) and from there to at 0.7012 (200-DMA), below which 0.6955 (multi-month lows) would be tested.