NZD/USD struggles near session lows, bulls trying to defend 0.7200 mark

The NZD/USD pair maintained its offered tone through the early European session and dropped to the 0.7200 mark, or fresh daily lows in the last hour.

Having struggled to make it through the 0.7240-45 resistance zone, the NZD/USD pair witnessed some selling on Tuesday and eroded a major part of the previous day's positive move. The pair, for now, seems to have snapped two consecutive days of the winning streak and was pressured by a goodish pickup in the US dollar demand.

Friday's softer NFP print tempered market expectations that the Fed could begin tapering its asset-purchases sooner rather than later. That said, worries over rising inflationary pressure held investors from placing any aggressive bearish bets around the USD, rather prompted some intraday short-covering move.

The USD bulls seemed rather unaffected by the ongoing decline in the US Treasury bond yields, instead took cues from a softer tone around the equity markets. This was seen as another factor that benefited the greenback's relative safe-haven status and further acted as a headwind for the perceived riskier kiwi.

Market participants now look forward to a relatively thin US economic docket, featuring the release of Trade Balance figures and JOLTS Job Openings later during the early North American session. This, along with the US bond yields and the broader market risk sentiment, might influence the USD and provide some impetus to the NZD/USD pair.

Technical levels to watch