NZD/USD rises to 10-day MA, tracks New Zealand 10-year yield


  • NZD/USD's recovery from one-month lows is gathering traction. 
  • NZ's 10-year bond yield is flashing green and could rise further on trade optimism. 
  • Kiwi has been closely following NZ's bond yield since the beginning of the month. 

NZD/USD is extending a recovery from one-month lows reached Wednesday, as New Zealand's 10-year bond yield is flashing green.

The currency pair is currently trading near the 10-day average at 0.6636, having hit a low of 0.6584 on Wednesday. That was the lowest level since Dec. 19.

The recovery from four-week lows could be associated with the two basis point rise in New Zealand's 10-year yield. The benchmark yield bottomed out at 1.48% on Jan. 12, signaling an end of the pullback from the Jan. 3 high of 1.68% and is currently trading at 1.52%.

Interestingly, the Kiwi dollar also faced selling pressure in the first two weeks of this month, falling from 0.6750 to levels below 0.6 and is now showing signs of life.

Looking forward, the benchmark bond yield could rise further due to optimism on the trade front. The US and China on Wednesday signed the much-anticipated phase-one trade deal. Further, the two nations have begun discussions on a phase two deal, Vice President Pence informed markets.

The NZD/USD pair, therefore, could rise above the 10-day average during the day ahead. However, if stocks come under pressure, NZD/USD will likely trim gains.

That possibility cannot be ruled out, as Yuan, equities and other markets have been pricing in a potential deal since November and could witness sell-the-fact trade now that the deal has been signed.

Technical levels

NZD/USD

Overview
Today last price 0.6633
Today Daily Change 0.0020
Today Daily Change % 0.30
Today daily open 0.6613
 
Trends
Daily SMA20 0.6655
Daily SMA50 0.6543
Daily SMA100 0.6442
Daily SMA200 0.6516
 
Levels
Previous Daily High 0.6622
Previous Daily Low 0.6584
Previous Weekly High 0.6681
Previous Weekly Low 0.6599
Previous Monthly High 0.6756
Previous Monthly Low 0.6424
Daily Fibonacci 38.2% 0.6607
Daily Fibonacci 61.8% 0.6598
Daily Pivot Point S1 0.6591
Daily Pivot Point S2 0.6568
Daily Pivot Point S3 0.6553
Daily Pivot Point R1 0.6629
Daily Pivot Point R2 0.6644
Daily Pivot Point R3 0.6667

 

 

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