NZD/USD jumps to 0.6460 highs with the US dollar on retreat

The New Zealand dollar has accelerated its rebound from one-week lows at 0.6385 to hit session highs at 0.6460 on the North American afternoon session. The dollar is losing ground across the board amid a moderate improvement on the market mood and portfolio rebalancing moves at the end of the quarter.

Kiwi gains on US dollar’s weakness

The NZD/USD has turned positive after a weak day-opening. The moderate improvement on market sentiment, with US equities hitting day highs amid the strong quarterly performance of Wall Street, has weighed on the safe-haven US dollar, boosting demand for riskier currencies like the New Zealand dollar.

On the macroeconomic front, the greenback has failed to find support from the upbeat US consumer confidence, which has risen to 98.1 in June, beating expectations of a 91 reading, from the 85.9 posted in May. Quarter-end moves seem to be punishing the USD, as reflected in the Dollar Index, which has turned negative on daily charts after having opened the day on a solid footing.

NZD/USD: Important resistance at 0.6480 – UOB

Despite the current appreciation, the FX strategists at UOB remain negative on the pair, while below 0.6480, “There is not much to add to our latest narrative from last Thursday (25 Jun. spot at 0.6420). As highlighted, if NZD closes below 0.6380, it could weaken further to 0.6320. The prospect for such a move has ticked up but is still not high. Overall, only a break of 0.6480 (‘strong resistance’ level previously at 0.6510) would indicate the downside risk has dissipated.”

NZD/USD key levels to watch