NZD/USD quickly reverses a knee-jerk slide to 0.7210 level

The NZD/USD pair failed to build on early up-move and tumbled to the 0.7200 neighborhood, albeit has managed to quickly recover back to the 0.7240-45 region. 

The pair's volatile swing in the past hour or so could be attributed to the latest News/Colmar Brunton NZ election poll that showed opposition Labour party was leading by 4% against the ruling Nationalists.

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Against the backdrop of already positive sentiment surrounding the US Dollar, uncertainty over the outcome of NZ national election kept investors on edge and dragged the pair session lows. 

Looking at the broader picture, the pair has held within a broader trading range - between 50-day SMA hurdle and 100-day SMA support, over the past one week. Hence, it would be prudent to wait for a decisive break through the mentioned band before positioning for the next leg of directional move.

Later during the NA session, the latest US consumer inflation figures might influence Fed rate hike expectations and provide some near-term impetus for higher-yielding currencies - like the Kiwi.

Technical levels to watch

Immediate strong support remains near the 0.7210-0.7200 region (100-day SMA), below which the pair is likely to accelerate the fall towards the very important 200-day SMA support near 0.7140-35 zone.

On the upside, momentum above 0.7285 level might continue to confront fresh supply near the 0.7320-30 region (50-day SMA hurdle), which if conquered might trigger a short-covering rally towards 0.7370 level en-route the 0.7400 handle.