NZD/USD hits three-day highs above 0.6200 as US dollar weakens
- Improvement in risk sentiment weighs on the US dollar.
- US yields higher after a better-than-expected jobs report.
- NZD/USD recovers from 2-year lows, heads for a weekly gain.
The NZD/USD is trading above 0.6200, at the highest level in three days. The pair rose more than 70 pips from the daily low boosted by a weaker US dollar across the board.
Risk-on, NZD up
An improvement in risk sentiment triggered a reversal of the US dollar. Stocks in Wall Street are up after a negative opening. The Dow Jones rises by 0.37% and the Nasdaq 0.43%. US yields are at weekly highs, with the 10-year at 3.07%.
Regarding economic data released on Friday, the US June jobs report showed the economy added 372K payroll against expectations of 268K. The unemployment rate held steady at 3.6%, in line with market consensus.
The NZD/USD bottomed at 0.6130 after NFP and then rebounded more than 70 pips. It printed a fresh daily high at 0.6206. As of writing, it remains near the top, with a positive momentum.
The 4-hour chart shows the pair breaking above a short-term downtrend line and the 0.6190 resistance. If it remains above, more gains seem likely. The next resistance stands at 0.6220 followed by 0.6250. A slide back under 0.6190 would expose again 0.6130.
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The NZD/USD is about to end the week with modest gains and far from the two-year low it reached on Tuesday at 0.6123. Next Wednesday, the Reserve Bank of New Zealand will announce its decision on monetary policy. A rate hike from 2% to 2.50% is expected.
Technical levels
Author
Matías Salord
FXStreet
Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.
