NZD/USD Facing the 100 Daily SMA, As Commodity Dollars Surge

Although, looking at the daily chart we can see that this pair experienced a strong rally last week as risk sentiment improved, reaching a high of 0.6247. The next resistance level comes at around 0.6370-80, which was the high in April and May. If buyers push the price above that level, then the streak of lower highs will be broken and the bullish momentum might continue.

On Wednesday last week, we saw a retreat lower, after the quarterly GDP report. The Q1 GDP figure was in line with expectations, showing a contraction of -0.1%, which was a slight improvement compared to the previously revised figure of -0.7% (originally reported as -0.6%). It’s worth noting that previous quarters also underwent downward revisions.

On an annual basis, the GDP growth rate until the end of March was 2.2%, falling short of the anticipated 2.6% and remaining the same as the previously reported figure of 2.2%. So, the GDP report revealed some downward revisions and a lower-than-expected annual growth rate, leading to the retreat in the value of the New Zealand Dollar. But, that retreat was short lived and the NZD recuperated well, helped by better sentiment and a very strong AUD.