• NZD/USD once again managed to defend and bounce off the 0.6700 round-figure mark.
  • The risk-on impulse in the markets extended some support to the perceived riskier kiwi.
  • Subdued USD demand remained supportive, though the uptick lacked bullish conviction.

The NZD/USD pair held steady around the 0.6725 area through the early European session, albeit seemed struggling to capitalize on its intraday bounce from a fresh YTD low.

The pair once again managed to attract some buying near the 0.6700 round-figure mark on Tuesday and for now, seems to have snapped two consecutive days of the losing streak. A solid recovery in the global risk sentiment – as depicted by a positive turnaround in the equity markets – was seen as a key factor that benefitted the perceived riskier kiwi. Apart from this, subdued US dollar price action extended additional support to the NZD/USD pair.

That said, the Fed's hawkish outlook, along with an uptick in the US Treasury bond yields acted as a tailwind for the greenback. It is worth recalling that the Fed announced last Wednesday that it would double the pace of tapering to $30 billion per month. Moreover, the so-called dot plot indicated that officials expect to raise the fed funds rate at least three times next year. Apart from this, COVID-19 jitters capped the upside for the NZD/USD pair.

Investors remain concerned about the potential economic fallout from the rapid spread of the Omicron coronavirus variant. Apart from this, a fatal blow to US President Joe Biden's massive $1.75 trillion social spendings and climate bill might keep a lid on any optimistic move in the markets. This, in turn, warrants some caution before confirming that the NZD/USD pair has bottomed out in the near term and positioning for any further appreciating move.

Investors might also be reluctant to place aggressive bets amid relatively thin liquidity conditions heading into the end-of-year holiday season and absent relevant market moving economic releases. That said, the US bond yields could influence the USD price dynamics and provide some impetus to the NZD/USD pair. Traders will further take cues from the broader market risk sentiment to grab some short-term opportunities around the major.

Technical levels to watch

NZD/USD

Overview
Today last price 0.6723
Today Daily Change 0.0009
Today Daily Change % 0.13
Today daily open 0.6714
 
Trends
Daily SMA20 0.6798
Daily SMA50 0.6974
Daily SMA100 0.6991
Daily SMA200 0.7046
 
Levels
Previous Daily High 0.676
Previous Daily Low 0.6702
Previous Weekly High 0.6834
Previous Weekly Low 0.6701
Previous Monthly High 0.7199
Previous Monthly Low 0.6773
Daily Fibonacci 38.2% 0.6724
Daily Fibonacci 61.8% 0.6738
Daily Pivot Point S1 0.6691
Daily Pivot Point S2 0.6667
Daily Pivot Point S3 0.6633
Daily Pivot Point R1 0.6749
Daily Pivot Point R2 0.6784
Daily Pivot Point R3 0.6807

 

 

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