NZD/USD: Recovery capped below 0.7200, despite upbeat China PMI

The NZD/USD pair extends its overnight consolidation phase below 0.72 handle, following the release of surprisingly positive Chinese Caixin manufacturing PMI report, as markets await the US payrolls data for next direction.

NZD/USD eyes on 200-DMA at 0.7154

The Kiwi continues to remain on the defensive and prefers to consolidate the American recovery from two-month lows of 0.7132, largely shrugging-off an upside surprise delivered by China’s manufacturing PMI data, which rose to the highest levels since Feb this year.

China's August Caixin PMI unexpectedly rises, strongest since Feb

Moreover, further recovery appears to lack follow-through, as cautiousness set into the markets ahead of the highly influential US labour market report, which will set the course for the next policy move by the Fed.

Furthermore, the recent NZD jawboning by the RBNZ Governor Wheeler combined with downbeat NZ business confidence numbers, also continue to cap the upside in the spot.

Meanwhile, the NZD/USD pair also remains weighed down by the mixed sentiment seen on the Asian equities, in the wake of renewed weakness seen in oil prices.

NZD/USD Levels to consider                                                                              

NZD/USD remains below 0.7200 (natural resistance), with 0.7154 (200-DMA) still guarding 0.7100 (round figure) and a break back below 0.7056 (June lows) are key near-term downside areas. To the topside, a test of 0.7229/33 (10 & 100-DMA) due on the cards, which could open doors towards 0.7263 (20-DMA).