NZD/USD consolidates just above 0.73 handle in a directionless trade

The NZD/USD pair struggled for a firm direction and remained confined within a 20-pips narrow trading range, just above the 0.7300 handle through early European trading session.

The pair seems to have stalled last week's recovery move 5-week lows and remained capped below 50-day SMA heavy supply zone near the 0.7325-35 region. A modest pickup in the US Dollar demand, coupled with the prevalent risk-off environment collaborated towards keeping a lid on any up-move for perceived riskier currencies - like the Kiwi. 

Meanwhile, the recent price action over the past three days clearly seems to suggest that the pair has moved into a consolidation phase as investors seemed to wait for a fresh catalyst before positioning for the next leg of directional move. Hence, this week's key focus would remain on the Jackson Hole Symposium, where the Fed Chair Janet Yellen's speech would drive the pair in the near-term.

There is no major market moving economic reports due for release from the US and hence, the pair seems more likely to extend the consolidative price-action ahead of this week's key event risk. 

Technical levels to watch

Weakness below the 0.7300 handle is likely to find support near the 0.7280-75 region, below which the pair is likely to head back towards the 0.7230-25 strong horizontal support. 

On the upside, 50-day SMA, near the 0.7325-35 region, remains immediate strong supply zone, which if cleared might trigger a short-covering rally towards the 0.7400 handle with some intermediate resistance near the 0.7370-75 region.