NZD/USD confined in a narrow trading band around 0.7400 handle

Having witnessed a pull-back from multi-month highs on Thursday, the NZD/USD pair was seen consolidating in a narrow band around 0.7400 handle. 

The pair had a muted reaction to weaker-than-expected Chinese headline inflation print for August, as measured by CPI, released during early Asian session on Friday. 

During the course of current trading week, the pair broke through near-term term trading range and rose to the highest level since May 2015. The move was supported by yet another strong rise of 7.7% in GDT price index. 

Moreover, fading expectations of an eventual Fed rate-hike action in September was also one of the factors weighing on the greenback and driving the pair higher.

With an empty US economic docket, the pair might consolidate the recent gains and remain confined in a narrow trading band. Nevertheless, the pair still seems to be headed to post second consecutive and fourth weekly gain in the previous five. 

Technical levels to watch

On a sustained break below 0.7400 handle, the pair seems to slide immediately towards 0.7365 horizontal support ahead of a major support near 0.7300 round figure mark. On the upside, 0.7445-50 now seems to act as immediate resistance above which the pair seems to aim back towards multi-month highs resistance near 0.7480 region before aiming to reclaim 0.7500 psychological mark.