NZD/USD building on to disappointing GDP-led slide

The NZD/USD pair held on to its disappointing GDP-led losses and is currently hovering around the lower end of daily trading range near 0.7260 region.

Having faced rejection at 0.7300 handle, Thursday's release of lower-than-expected second quarter growth number seems to have renewed expectations of further monetary easing by RBNZ. Moreover, the prevalent risk-off sentiment and uncertainty over the Fed's next monetary policy move is weighing on high-yielding currencies - like Kiwi. 

Today's key focus remains on BOE monetary policy decision, which although would not impact the pair directly but is expected to infuse volatility in the FX market and eventually provide some impetus during European session.

Later during NA trading session, a slew of US macro releases would be looked upon in order to gauge possibilities of Fed rate-hike action in September that remains the key determinant of the pair's near-term direction. 

Technical levels to watch

A follow through selling pressure below weekly lows support near 0.7235 level is likely to drag the pair towards 50-day SMA support near 0.7215, which if broken now seems to force the pair to break through 0.7200 handle and head towards testing its next support near 0.7160 area.

Meanwhile on the upside, 20-day SMA near 0.7300 handle now becomes immediate resistance, which if cleared is likely to assist the pair to stage additional recovery further towards 0.7350 resistance. Only a sustained move back above 0.7350 resistance might negate expectations of further corrective move and help the pair to resume its near-term upward trajectory.