NZD/USD Price Analysis: Retreats towards 0.5920 on softer NZ data, US Dollar rebound

• NZD/USD pares the biggest daily gains in six weeks within fortnight-old descending trend channel.
• Disappointing prints of New Zealand Building Permits for July recall Kiwi bears after two-day absence.
• Previous resistance line from late July lures Kiwi sellers but bullish MACD signals keep buyers hopeful.
• Key SMAs, bearish chart formation challenge bulls ahead of top-tier US data.

NZD/USD takes offers to refresh the intraday low near 0.5945 during early Wednesday morning in Europe. In doing so, the Kiwi pair justifies the downbeat New Zealand (NZ) housing data, as well as portrays the market’s cautious mood ahead of the top-tier US data.

New Zealand Building Permits for July marked a notable slump of 5.2% MoM versus 0.2% expected and 3.4% prior (revised from 3.5%).

It’s worth noting that the US ADP Employment Change, the final readings of the US second quarter (Q2) Gross Domestic Product (GDP) and the Personal Consumption Expenditure (PCE) are on the calendar and prod the sentiment, as well as the NZD/USD price. With this, the US Dollar Index (DXY) also licks its wounds around 103.60 after falling the most in six weeks the previous day.

Technically, a retreat from the top-line of a two-week-old bearish channel, as well as a downside break of the 100-SMA, favors the NZD/USD sellers to aim for the previous resistance line stretched from late July, close to 0.5920 at the latest.

However, the bullish MACD signals and the bottom line of the stated channel, near 0.5890 by the press time, challenge further downside of the Kiwi pair past 0.5920.

Meanwhile, the 100-SMA and the channel’s top-line, respectively near 0.5965 and 0.5980, guard immediate recovery of the NZD/USD pair.

Following that, a run-up towards the 200-SMA hurdle of around 0.6080 can’t be ruled out.

NZD/USD: Four-hour chart

Trend: Limited downside expected