NZD/USD retests 50-DMA, seems vulnerable to slide further

Having failed to sustain its recovery strength back above 0.7300 handle, the NZD/USD pair remained well offered on Wednesday and has now dropped back to 50-day SMA support. 

Currently trading at a fresh session low around 0.7240 region, the pair has erased all of its recovery witnessed in the past two trading session. A broadly strong greenback, as measured by the US Dollar Index, has been the key factor weighing on the pair. 

Moreover, the prevalent cautious sentiment in European equity markets is also providing an additional boost to the safe-haven appeal of the US Dollar against the kiwi, which remains undermined on increasing prospects of further interest-rate by RBNZ in November.

Going forward, traders will focus on the release of durable goods orders data and the Fed Chair Janet Yellen's testimony for fresh impetus for the pair's near-term trajectory.

Technical levels to watch

On a sustained weakness below 50-day SMA support near 0.7240-35 region, the pair is likely to accelerate the slide immediately towards weekly lows support near 0.7220 level. On the upside, 0.7270 now becomes immediate resistance and is closely followed by resistance near 0.7300 handle. Only a decisive strength back above 0.7300 handle might now negate any near-term bearish bias and assist the pair to stage additional recovery.