Note

NZD/USD sticks to gains above 0.5800 amid modest USD weakness, focus remains on NFP

· Views 35
  • NZDUSD regains positive traction on Friday and draws support from a combination of factors.
  • A modest USD downtick and a positive risk tone offer some support to the risk-sensitive Kiwi.
  • The Fed’s hawkish outlook should help limit the USD losses and cap the pair ahead of the NFP.

The NZDUSD pair attracts fresh buying near the 0.5755 region on Friday and reverses the previous day's slide to over a one-week low. The pair maintains its bid tone through the early European session and is currently placed near the daily high, just above the 0.5700 round-figure mark.

The US Dollar pauses the post-FOMC rally and for now, seems to have snapped a six-day winning streak, which, in turn, offers support to the NZDUSD pair. A generally positive tone around the equity markets is seen weighing on the safe-haven buck and benefiting the risk-sensitive Kiwi. Apart from this, the USD downtick could be attributed to some repositioning trade ahead of the closely-watched US monthly jobs report, due for release later during the early North American session.

That said, elevated US Treasury bond yields, bolstered by a more hawkish stance adopted by the Federal Reserve, should limit any deeper USD pullback and cap gains for the NZDUSD pair. It is worth recalling that Fed Chair Jerome Powell downplayed expectations for a dovish pivot and said that it was premature to discuss a pause in the rate-hiking cycle. Powell added that the terminal rate will still be higher than anticipated and triggered a sharp rise in the US Treasury bond yields.

In fact, the yield on the two-year US government bond, which is highly sensitive to interest rate hike expectations, touched a 15-year high on Thursday and inched closer to the 5% psychological mark. The benchmark 10-year US Treasury note, meanwhile, holds steady above the 4.0% threshold and favours the USD bulls. Heading into the key data risk, the fundamental backdrop might hold back traders from placing aggressive bets and cap the upside for the NZDUSD pair, for the time being.

Technical levels to watch

NZD/USD

Overview
Today last price 0.5814
Today Daily Change 0.0042
Today Daily Change % 0.73
Today daily open 0.5772
Trends
Daily SMA20 0.5702
Daily SMA50 0.5835
Daily SMA100 0.6043
Daily SMA200 0.6344
Levels
Previous Daily High 0.5843
Previous Daily Low 0.5741
Previous Weekly High 0.5874
Previous Weekly Low 0.5657
Previous Monthly High 0.5874
Previous Monthly Low 0.5512
Daily Fibonacci 38.2% 0.578
Daily Fibonacci 61.8% 0.5804
Daily Pivot Point S1 0.5728
Daily Pivot Point S2 0.5683
Daily Pivot Point S3 0.5625
Daily Pivot Point R1 0.583
Daily Pivot Point R2 0.5888
Daily Pivot Point R3 0.5932

Disclaimer: The content above represents only the views of the author or guest. It does not represent any views or positions of FOLLOWME and does not mean that FOLLOWME agrees with its statement or description, nor does it constitute any investment advice. For all actions taken by visitors based on information provided by the FOLLOWME community, the community does not assume any form of liability unless otherwise expressly promised in writing.

FOLLOWME Trading Community Website: https://www.followme.com

If you like, reward to support.
avatar

Hot

No comment on record. Start new comment.