NZD/USD gained after the RBNZ decision earlier but the 100-day moving average is putting a lid on any further upside momentum for now
The pair gained some solid momentum to start the day after the RBNZ decision earlier, which helped the kiwi jump higher as the central bank kept policy unchanged and reaffirmed the current stance for the foreseeable future.
NZD/USD broke key near-term levels to rise to a high of 0.6477 but gains are stalling at the level as it coincides with the 100-day MA (red line).
On the daily chart, price is also having to contend with the 23.6 retracement level of the swing move lower since the start of the year @ 0.6467.
Those are the key resistance levels that buyers need to find a way past for now.
Beyond that, further resistance is seen around 0.6500 next with the 200-day MA (blue line) lurking nearby @ 0.6502 currently.
From a fundamental perspective, the RBNZ shutting the door on rate cuts this year may not necessarily provide much upside for the kiwi against the dollar - considering that the Fed is also not likely to cut rates as well this year.
But with the coronavirus outbreak and potential implications towards the Chinese economy, it is more likely than not that the kiwi will be more heavily affected than the dollar if things do get worse - not to mention the dollar's status as a haven.
I'd be more confident of further short covering in the kiwi if price can move above 0.6500 but otherwise, there is still the risk for a retracement back lower as long as the virus outbreak continues to play in the back of the investors' minds.
