NZD/USD edges back to weekly tops, around 0.7330
|After yesterday's pullback, the NZD/USD pair regained traction on Friday and is currently placed near weekly tops around the 0.7325-30 region.
Fresh US political jitters kept the US Dollar on the back-foot and had been one of the key factors driving the pair higher on the last trading day of the week. On Thursday, the US President Donald Trump abandoned plans for an advisory council on infrastructure spending. This followed the disbanding of two other business panels on Wednesday and further dampened sentiment around the greenback.
• US: Uncertain political environment to keep the $ pinned down - ING
Meanwhile, growing market consensus that the Fed might hold back from raising interest rates further in 2017, coupled with the prevalent positive trading sentiment around commodity space was also seen boosting demand for higher-yielding/commodity-linked currencies - like the Kiwi.
It, however, remains to be seen if the pair is able to build on the up-move, or once again fails to sustain the recovery back above 50-day SMA important support break point, amid a fresh wave of global risk aversion trade, which tends to support the buck's safe-haven appeal against the NZ counterpart.
Today's US economic docket features the release of prelim UoM consumer sentiment Index, which will be followed by a scheduled speech by the Dallas Fed President Robert Kaplan.
Technical levels to watch
On a sustained move above 0.7335 level, leading to a subsequent strength beyond mid-0.7300s is likely to accelerate the up-move towards 0.7370-75 intermediate hurdle ahead of the 0.7400 handle. On the flip side, retracement back below the 0.7300 handle might continue to find some support near 0.7280 level, below which the pair is likely to head towards multi-week lows support near the 0.7225-20 region.
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