NZD/USD slips below 100-DMA to 0.6710 after US jobless claims

The NZD/USD pair reversed all of its recovery witnessed during the European session and dropped to session low of 0.6710 after the release of weekly jobless claims from the US.

The US initial claims for unemployment related benefits for the previous week fell by 16,000 to 278,000, mostly in-line with expectations. The sharp drop in weekly jobless claims continues to point towards the underlying strength in the US labor market. This coupled with Wednesday's hawkish Fed minutes further fueled speculations of a Fed rate-hike as early as June.

Earlier during the day, the NZD/USD pair defended 100-day SMA support and rebounded to 0.6750. But the bounce, however, was short-lived and provided bears with the opportunity to sell at higher levels. The pair has now dropped below 100-day SMA and hence, could turn vulnerable to further downside in the near-term.

Technical levels to watch

On a sustained weakness below 100-day SMA, the pair seems to extend its slide immediately towards 0.6700 level, below which the fall could further get extended towards the very important 200-day SMA support, currently near 0.6650 region.

Meanwhile on the upside, 0.6750 now become immediate key resistance to watch for. Should the pair manage to to extend its recovery beyond this immediate resistance, it could immediately be aiming towards 0.6800 round figure mark. However, the pair needs to clear and sustain its strength beyond 0.6815-20 resistance and attempt a move beyond 0.6845-50 strong horizontal resistance in order to increase the prospects of further near-term recovery.