NZD/USD gains further beyond 0.73 handle on notable USD supply
| • 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.
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