NZD/USD: bears cheer trade data big miss; fresh pull back low at 0.6629, eyes on 21-D SMA

• NZD/USD has dropped on the back of the trade data for August -1484m. 
• New Zealand trade balance for August -1484m and a big miss vs the expected -925m, prior -143m.
• Exports a miss at 4.05bn vs the expected 4.40bn and prior 5.35bn.
• Imports 5.45bn vs the expected 5.50bn and prior 5.49bn.

This data does little for the bulls in an increasingly bearish outlook fundamentally for the bird - cementing the case for the downside and a return trip to what was already an ambiguous correction within a broader bear trend. NZD/USD has been in a pullback since reaching and piercing the trend line resistance up at 0.6696 and has eyes for the 0.6617 support that guards the 21-D SMA at 0.6607 following the doji printed last week at the 0.6699 highs. 

NZD/USD will now be subject to what goes down in the business confidence data and then it back to the China/US trade spat, EM-FX and indeed the outcome of the FOMC tonight and RBNZ that follows tomorrow. 

• RBNZ seen holding rates at September policy meeting - Reuters
• Fed Preview: Market Moving Fed Policy?

RBNZ outlook

Westpac NZ economists are expecting that the RBNZ will leave the OCR unchanged at next week's OCR Review:

"However, there is still a one in three chance that the RBNZ cuts the OCR over the coming year:

• We expect the tone of the OCR Review to be either neutral or dovish from a market point of view.
• A neutral Review would simply restate that the next move could be "up or down." - The other possibility is that the RBNZ adopts a "soft" easing bias, explicitly warning that if the economy fails to accelerate as expected, the OCR could fall.
• This would match RBNZ comments made in the media, and would be in the spirit of open and frank communication that the RBNZ has embraced.
• It seems very unlikely that the RBNZ will issue a hawkish statement that causes interest rates and the exchange rate to rise. The balance of risks for next week's OCR Review is in the direction of lower interest rates and a lower exchange rate."

NZD/USD levels

The bird is offered below the doji and targets the 0.6620 level.  If the bird can't break the doji's top at 0.6699 on a pullback, the case will be building for a sustained correction/reversal. First, the pair needs to break 0.6711 as the 76.4% retracement of the daily downtrend from 0.7393. A drop back into the downside opens a continuation risk towards 0.6500 that would open up 0.6344 and 0.6306 on the wide.