Extending its recovery from early Asian dip below 50-day SMA, the NZD/USD pair jumped to hit fresh session high level of 0.7279 before retracing few pips to currently trade around 0.7270 level.
In absence of any fresh fundamental development, the pair's ongoing recovery could be on the back of some short-covering / repositioning ahead of a slew of economic releases from the US and following its rebound from the vicinity of 50-day SMA immediate support.
Moreover, as the initial Deutsche Bank - led global jitters receded, traders seem to be moving out of traditional safe-haven assets that is eventually driving demand for higher-yielding currencies - like Kiwi.
Coming up next, the release of Core PCE Price Index, personal income & spending data, Chicago PMI and revised UoM consumer sentiment from the US would provide fresh impetus for the pair’s next leg of move during US trading session.
Technical levels to watch
From current levels, 0.7300 handle remains immediate hurdle, which if conquered has the potential to boost the pair further towards 0.7350-55 resistance area with intermediate resistance near 0.7325 level.
On the flip side, 0.7250-45 region (50-day SMA) now seems to have emerged as immediate strong support and a decisive break back below this important support now seems to open room for further near-term depreciating move for the pair, possibly towards its next major support near 0.7200 handle.
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