The NZD/USD pair maintained its strong bid tone and is now building on to its gains above 0.7300 handle to currently trade at 8-day high around 0.7320-25 band.
The major gained traction after RBNZ Governor Graeme Wheeler dumped expectations of rapid monetary easing by the central bank. Wheeler added that speeding up interest rate cuts could be unsustainable and further fuel already overheating property market.
Tuesday's up-move lifted the pair close to a multi-month high level touched on August 11 in the aftermath of RBNZ's announcement to cut its benchmark interest-rates by 25 bps, which was less than market expectations.
With a relatively lighter US economic calendar on Tuesday, featuring the release of new home sales and Richmond Manufacturing Index, the pair might continue to benefit from a broadly weaker greenback.
Technical levels to watch
From current levels, August monthly high near 0.7340 level remains immediate barrier, which if conquered sets the stage for continuation of the pair's near-term upward trajectory further towards 0.7395 (May 22, 2015 high). A follow through buying interest above 0.7395-0.7400 resistance should pave way further appreciating move for the pair in the near-term.
Meanwhile on the downside, previous strong resistance near 0.7285-80 region now seems to protect any weakness below 0.7300 handle. Any further fall below 0.7280 support area might now be bought into and hence, should be limited by support at 0.7250 level.
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
AUD/USD could extend the recovery to 0.6500 and above
The enhanced risk appetite and the weakening of the Greenback enabled AUD/USD to build on the promising start to the week and trade closer to the key barrier at 0.6500 the figure ahead of key inflation figures in Australia.
EUR/USD now refocuses on the 200-day SMA
EUR/USD extended its positive momentum and rose above the 1.0700 yardstick, driven by the intense PMI-led retracement in the US Dollar as well as a prevailing risk-friendly environment in the FX universe.
Gold struggles around $2,325 despite broad US Dollar’s weakness
Gold reversed its direction and rose to the $2,320 area, erasing a large portion of its daily losses in the process. The benchmark 10-year US Treasury bond yield stays in the red below 4.6% following the weak US PMI data and supports XAU/USD.
Bitcoin price makes run for previous cycle highs as Morgan Stanley pushes BTC ETF exposure
Bitcoin (BTC) price strength continues to grow, three days after the fourth halving. Optimism continues to abound in the market as Bitcoiners envision a reclamation of previous cycle highs.
US versus the Eurozone: Inflation divergence causes monetary desynchronization
Historically there is a very close correlation between changes in US Treasury yields and German Bund yields. This is relevant at the current juncture, considering that the recent hawkish twist in the tone of the Federal Reserve might continue to push US long-term interest rates higher and put upward pressure on bond yields in the Eurozone.