• USD weighed down by weaker US bond yields.
• The pair further supported by positive commodities.
The NZD/USD pair quickly reversed an early dip to sub-0.7300 level, closer to Friday's near two-week lows, and has managed to rebound over 50-pips from session lows.
A fresh wave of US Dollar weakness, primarily led by faltering US Treasury bond yields was seen as one of the key factors underpinning demand for higher-yielding currencies - like the Kiwi.
Adding to this, positive sentiment surrounding commodity space provided an additional boost to commodity-linked currencies and remained supportive of the pair's strong up-move at the start of a new trading week.
The pair has now recovered a major part of Friday's sharp fall and moved back closer to its immediate resistance near the 0.7340-50 region. Hence, it would be prudent to wait for a follow-through buying interest before positioning for any further near-term appreciating move.
Traders now look forward to the new home sales data from the US for some short-term trading impetus but the key focus would be on the new Fed Chair Jerome Powell's first congressional testimony on Tuesday, which would help investors determine the pair's next leg of directional move.
Technical levels to watch
Momentum beyond the mentioned immediate resistance near the 0.7340-50 region might confront some fresh supply near 0.7375 level, above which the pair is likely to aim towards reclaiming the 0.7400 handle.
On the flip side, 0.7315-10 area, closely followed by the 0.7300 handle, now seems to protect the immediate downside, which if broken might turn the pair vulnerable to head towards testing 50-day SMA support near the 0.7235-30 region.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
GBP/USD remains on the defensive below 1.2450 ahead of UK Retail Sales data
GBP/USD remains on the defensive near 1.2430 during the early Asian session on Friday. The downtick of the major pair is backed by the stronger US Dollar as the strong US economic data and hawkish remarks from the Fed officials have triggered the speculation that the US central bank will delay interest rate cuts to September.
EUR/USD extends its downside below 1.0650 on hawkish Fed remarks
The EUR/USD extends its downside around 1.0640 after retreating from weekly peaks of 1.0690 on Friday. The hawkish comments from Federal Reserve officials provide some support to the US Dollar.
Gold: Middle East war fears spark fresh XAU/USD rally, will it sustain?
Gold price is trading close to $2,400 early Friday, reversing from a fresh five-day high reached at $2,418 earlier in the Asian session. Despite the pullback, Gold price remains on track to book the fifth weekly gain in a row.
Bitcoin Price Outlook: All eyes on BTC as CNN calls halving the ‘World Cup for Bitcoin’
Bitcoin price remains the focus of traders and investors ahead of the halving, which is an important event expected to kick off the next bull market. Amid conflicting forecasts from analysts, an international media site has lauded the halving and what it means for the industry.
Israel vs. Iran: Fear of escalation grips risk markets
Recent reports of an Israeli aerial bombardment targeting a key nuclear facility in central Isfahan have sparked a significant shift out of risk assets and into safe-haven investments.