NZD/USD seems vulnerable near YTD low, below mid-0.6700s amid stronger USD

  • NZD/USD was seen oscillating in a narrow trading band near the lowest level since November 2020.
  • Hawkish Fed expectations, rebounding US bond yields underpinned the USD and capped the upside.
  • Easing Omicron fears extended some support to the perceived riskier kiwi and helped limit losses.

The NZD/USD pair consolidated its recent losses to the lowest level since November 2020 and was seen oscillating in a range around the 0.6750-40 region heading into the European session.

A combination of diverging forces failed to provide any meaningful impetus to the NZD/USD pair, instead led to a subdued/range-bound price action on the first day of a new week. The global risk sentiment stabilized a bit in reaction to reports from South Africa, suggesting that Omicron patients only had relatively mild symptoms. This was evident from a generally positive tone around the equity markets, which extended some support to the perceived riskier kiwi.

The supporting factor was largely offset by the emergence of fresh buying around the US dollar, which was seen as a key factor that acted as a headwind for the NZD/USD pair. As investors' looked past Friday's mixed US NFP report, the USD was back in demand amid firming expectations for a faster policy tightening by the Fed. Investors now seem convinced that the Fed would be forced to adopt a more aggressive policy response to contain stubbornly high inflation.

In fact, the money markets indicate a high probability of the Fed liftoff by May 2022. This, along with a goodish rebound in the US Treasury bond yields from the lowest level since September, underpinned the greenback. The fundamental backdrop seems tilted firmly in favour of the USD bulls and supports prospects for a further depreciating move for the NZD/USD pair. Hence, the range-bound price action might still be categorized as a bearish consolidation phase.

There isn't any major market-moving economic data due for release from the US on Monday, leaving the USD at the mercy of the US bond yields. Apart from this, fresh developments surrounding the coronavirus saga and the broader market risk sentiment should allow traders to grab some short-term opportunities around the NZD/USD pair.

Technical levels to watch


Today last price 0.6746
Today Daily Change -0.0005
Today Daily Change % -0.07
Today daily open 0.6751
Daily SMA20 0.6948
Daily SMA50 0.7012
Daily SMA100 0.7012
Daily SMA200 0.707
Previous Daily High 0.6828
Previous Daily Low 0.6741
Previous Weekly High 0.6868
Previous Weekly Low 0.6741
Previous Monthly High 0.7199
Previous Monthly Low 0.6773
Daily Fibonacci 38.2% 0.6774
Daily Fibonacci 61.8% 0.6795
Daily Pivot Point S1 0.6719
Daily Pivot Point S2 0.6686
Daily Pivot Point S3 0.6632
Daily Pivot Point R1 0.6806
Daily Pivot Point R2 0.686
Daily Pivot Point R3 0.6893



Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD struggles to rebound, holds near 1.1150 after US data

EUR/USD trades around 1.1150 in the early American session on Friday as investors assess the latest inflation data from the US. According to the US Bureau of Economic Analysis, Core PCE Price Index rose to 4.9% on a yearly basis in December from 4.7% in November, surpassing the market expectation of 4.8%. 


GBP/USD clings to small gains above 1.3400 on mixed US data

GBP/USD posts modest daily gains slightly above 1.3400 on Friday as the dollar rally loses steam. The data from the US showed that the core PCE inflation edged higher to 4.9% in December. On a negative note, Personal Spending contracted by 0.6% on a monthly basis.


Gold recovers modestly after US data, stays below $1,800

Gold managed to stage a rebound from the multi-week low it set below $1,780 but continues to trade deep in the red near $1,790. The benchmark 10-year US Treasury bond yield is rising more than 1% on the day after US data, limiting XAU/USD's recovery.

Gold News

Bitcoin Weekly Forecast: Federal Reserve cannot tame BTC’s uptrend

Bitcoin has experienced some significant losses over the past few weeks, with a more dramatic drop occurring this week after the Fed's decision was announced. As losses have extended and BTC has entered into the $30,000 zone, concerns regarding Bitcoin being in a bear market have increased.

Read more

Apple share price set to rise after another record quarter

With the Nasdaq closing at its lowest level in seven months yesterday, the Apple share price has also found itself on the end of the recent weakness in tech shares, down over 12% from its record highs in early January.

Read more