NZD/USD made a bullish reversal at the beginning of October, which looked just like another retrace higher before sellers pushed further below. But, sellers didn’t come back and we haven’t seen them since then. We have seen several pullbacks lower, but buyers have come back and have kept things in control.

The sentiment has improved for risk assets, as we approach the final stage of the Phase One deal between US and China. There have been events and comments which have taken this deal back and forth, such as Donald trump’s comments yesterday that he might postpone the deal until Chinese elections are over, responding to China targeting Trump’s electorate with retaliatory targets.

But, today we heard form Bloomberg that the deal might be signed off on December 15, despite the heated rhetoric, which calmed the nerves. Donald Trump also helped the sentiment when he said a while ago that talks with China are going very well.

NZD/USD had retraced lower during the Asian session, but  the 50 SMA (yellow) provided solid support on the H1 chart. The price bounced off that moving average as the sentiment improved after Trump’s comments at the NATO summit. So, this pair is pretty bullish now and we will look to open a buy signal on another pullback lower, to the 50 SMA.

This is a strong sign that the situation might have changed for the Kiwi. If something doesn’t go down on bad news, such as negative sentiment, which has been affecting risk assets a great deal until recently, then it shows that buyers are in total control. So, we have a strong bullish bias for NZD/USD for the next week or so. Too bad we missed the opportunity to buy this pair earlier today, during the pullback.