NZD/USD: Bulls attack 0.7200 despite bank holiday in New Zealand

NZD/USD eyes to fill the week-start gap from 0.7102 to 0.7192.
Risks stay firm amid expectations of US relief package, school re-open despite downbeat vaccine developments.
US dollar fell on Friday amid mixed data but Wall Street and Treasury yields came out positive.
Bank holiday in New Zealand, light calendar in Asia highlights risk news as catalysts.

Anil Panchal FXStreet

NZD/USD picks up bids around 0.7190 following a bounce off 0.7183 during the initial Asian session on Monday. The kiwi pair was among the Antipodeans that benefited from the US dollar’s U-turn on Friday as well as a jump in the risk catalysts.

Cheering US dollar weakness, upbeat NZ fundamentals…

With the steady recovery in New Zealand (NZ) employment data, in contrast to the mixed US jobs report, during January, the Reserve Bank of New Zealand (RBNZ) has another reason to stay away from further rate cuts. Also helping the kiwi optimists were NZ recovery from the coronavirus (COVID-19) and the recent approval of vaccines at home.

Read: RBNZ to hold off from rate cuts for the forseeible future, how much is already baked into the cake?

On a broader scale, US President Joe Biden’s $1.9 stimulus is back to Congress for final approval after Democratic Party used Vice President’s vote to fast-track their proposal. However, Republican Party members aren’t yet ready to free-up their limits near $700 billion.

Read: US President Biden: women dropping out of workforce, closed schools are “national emergency” – CBS

Global vaccinations have a bumpy road with production and delivery delays challenging the mood. Also on the negative side is the latest news, shared by the Financial Times, which quotes a study suggesting the Oxford/AstraZeneca vaccines not effective against the South African variant.

Amid these plays, Wall Street benchmarks were strong on Friday and the US 10-year Treasury yields probed March 2020 peak. Further, the US dollar index (DXY) took a U-turn from the two-month high with the largest daily drop in 2021.

Given the off in New Zealand markets, due to Waitangi Day, NZD/USD traders need to check on risk catalysts like US stimulus, vaccine developments and geopolitical headlines for fresh direction. Though, the bulls are likely to keep the reins more or less.

Technical analysis

Unless breaking the one-month-old descending resistance line, currently around 0.7205, NZD/USD bulls shouldn’t ignore the risk of a 50-day SMA retest, at 0.7150 now.

Additional important levels

Overview
Today last price	0.7195
Today Daily Change	-12 pips
Today Daily Change %	-0.17%
Today daily open	0.7207

Trends
Daily SMA20	0.7179
Daily SMA50	0.7134
Daily SMA100	0.6927
Daily SMA200	0.6702

Levels
Previous Daily High	0.7207
Previous Daily Low	0.7136
Previous Weekly High	0.7226
Previous Weekly Low	0.7135
Previous Monthly High	0.7316
Previous Monthly Low	0.7096
Daily Fibonacci 38.2%	0.718
Daily Fibonacci 61.8%	0.7163
Daily Pivot Point S1	0.716
Daily Pivot Point S2	0.7112
Daily Pivot Point S3	0.7089
Daily Pivot Point R1	0.7231
Daily Pivot Point R2	0.7254
Daily Pivot Point R3	0.7302

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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