NZD/USD declines below 0.7150 following last week's rally

NZD/USD stages a correction after posting strong gains last week.
US Dollar Index stays in the positive territory above 92.20.
Trading action is likely to remain subdued due to Labor Day holiday in US.

Eren Sengezer FXStreet

The NZD/USD pair gained more than 150 pips last week but struggled to preserve its bullish momentum on Monday. As of writing, the pair was down 0.25% on the day at 0.7142.

DXY rebounds in quiet day

On Friday, the disappointing jobs report from the US, which showed that Nonfarm Payrolls rose by only 235K in August, triggered a USD selloff and allowed NZD/USD to climb to its strongest level since early June at 0.7171. However, the US Dollar Index (DXY) is staging a rebound at the start of the week, forcing NZD/USD to retrace its rally. Currently, the DXY is up 0.17% on the day at 92.27.

Nevertheless, the lack of high-tier macroeconomic data releases and fundamental developments suggests that the DXY's rebound is a technical correction. Furthermore, the trading action is expected to remain subdued in the remainder of the day with the US markets being closed due to the Labor Day holiday.

NZD/USD: Waning Delta cases and higher yields to boost the kiwi – ANZ.

On Tuesday, the Reserve Bank of Australia (RBA) will announce its Interest Rate Decision and release the Rate Statement. A sharp reaction in the positively-correlated AUD/USD pair could impact NZD/USD's movements during the Asian trading hours.

Technical levels to watch for

NZD/USD

Overview
Today last price	0.7143
Today Daily Change	-0.0008
Today Daily Change %	-0.11
Today daily open	0.7151

Trends
Daily SMA20	0.6988
Daily SMA50	0.6989
Daily SMA100	0.7085
Daily SMA200	0.7115

Levels
Previous Daily High	0.7171
Previous Daily Low	0.7104
Previous Weekly High	0.7171
Previous Weekly Low	0.6987
Previous Monthly High	0.7089
Previous Monthly Low	0.6805
Daily Fibonacci 38.2%	0.7145
Daily Fibonacci 61.8%	0.7129
Daily Pivot Point S1	0.7113
Daily Pivot Point S2	0.7074
Daily Pivot Point S3	0.7045
Daily Pivot Point R1	0.718
Daily Pivot Point R2	0.7209
Daily Pivot Point R3	0.7248

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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