NZD/USD Finishes Lower on Strong US Data, Business Confidence Up Next

The Kiwi finished Monday's session down 0.13% at 0.6141, while the BBDXY finished a up 0.10% at 1,249.11. The currency trading higher heading into the US session before stronger-than-expected US consumer confidence provided the greenback with a temporary boost on Tuesday before receiving a second wind from higher US Treasury yields after tails at two- and five-year auctions.

• NZD/USD reached new monthly highs of 0.6170 on Tuesday, the move was on the back of China announcing new stimulus measures to boost demand for property.
• The move higher was short lived, as strong Consumer Confidence caused a rally in the USD, the pair fell 20-pips initially before closing the session at 0.6141. The 14-day RSI has ticked higher and now sits at 65, while the MACD holds steady.
• Key levels to watch: Initial resistance of 0.6170 (May 28th highs) above here we target the 0.6200/20 (round number/ March 8 high), while initial support holds at 0.6083 (May 22nd lows), a break here would target 0.6078 (20-day EMA)
• Fonterra Maintains 23/24 Milk Price forecast at NZ$7.8/KG.
• The US-NZ 2y is 3bps lower at -24.5bps
• Option expiries: 0.6115 ($196.24m) & 0.6050 ($200m) May 28th NY cut, while notable upcoming strikes are, 0.6195 ($150.12m) May 30, 0.5865 ($390m) May 30.
• Looking ahead: NZ ANZ Business Confidence & Activity Outlook