• NZD/USD witnessed a modest pullback from multi-month tops touched earlier this Thursday.
  • A softer risk tone, elevated bond yields benefitted the safe-haven USD and exerted pressure.
  • Rising bets for an additional RBNZ rate hike warrants caution for aggressive bearish traders.

The NZD/USD pair extended its retracement slide from multi-month lows and was last seen hovering near the lower end of the daily trading range, around the 0.7175 region.

Having climbed to the highest level since June 11 earlier this Thursday, the NZD/USD pair witnessed an intraday turnaround from the 0.7220 area amid a modest pickup in the US dollar demand. Fresh worries about a credit crunch in China's real estate sector tempered investors' appetite for perceived riskier assets. This, in turn, assisted the safe-haven USD to stage a modest bounce from over three-week lows and prompted some long-unwinding around the major.

The heavily indebted China Evergrande Group said on Wednesday that a $2.6 billion deal to sell the controlling stake in its property management business failed. The development took its toll on the global risk sentiment, which was evident from a generally weaker tone around the equity markets. Apart from this, the recent runaway rally in the US Treasury bond yields was seen as another factor that acted as a tailwind for the greenback.

The US bond yields have been scaling higher since late September amid prospects for an early policy tightening by the Fed. The FOMC meeting minutes released last Wednesday reaffirmed that the Fed remains on track to begin rolling back its massive pandemic-era stimulus as soon as November. The markets have also been pricing in the possibility of an interest rate hike in 2022 amid worries about a faster than expected rise in inflation.

That said, this week's US macro releases – Industrial Production and housing market data – pointed to weakening economic activity and moderated expectations for a more aggressive policy response by the Fed. This could keep a lid on any meaningful gains for the greenback and lend some support to the NZD/USD pair. This warrants some caution for bearish traders amid rising bets that the RBNZ will hike interest rates further to contain stubbornly high inflation.

Moreover, Thursday's pullback could still be attributed to some profit-taking against the backdrop of the recent strong rally of over 300 pips from the vicinity of the 0.6900 mark touched on October 13. This further makes it prudent to wait for a strong follow-through selling before confirming that the NZD/USD pair has topped out in the near term and positioning for any meaningful corrective slide.

Market participants now look forward to the US economic docket – featuring the releases of the Philly Fed Manufacturing Index and the usual Weekly Initial Jobless Claims. This, along with a scheduled speech by Fed Governor Christopher Waller and the US bond yields, might influence the USD later during the early North American session. Traders will further take cues from the broader market risk sentiment to grab some opportunities around the NZD/USD pair.

Technical levels to watch


Today last price 0.7177
Today Daily Change -0.0025
Today Daily Change % -0.35
Today daily open 0.7202
Daily SMA20 0.6994
Daily SMA50 0.7012
Daily SMA100 0.7021
Daily SMA200 0.7101
Previous Daily High 0.7209
Previous Daily Low 0.7146
Previous Weekly High 0.7078
Previous Weekly Low 0.6912
Previous Monthly High 0.7171
Previous Monthly Low 0.6859
Daily Fibonacci 38.2% 0.7185
Daily Fibonacci 61.8% 0.717
Daily Pivot Point S1 0.7162
Daily Pivot Point S2 0.7123
Daily Pivot Point S3 0.7099
Daily Pivot Point R1 0.7225
Daily Pivot Point R2 0.7249
Daily Pivot Point R3 0.7288



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 Join Telegram

Recommended content

Recommended content

Editors’ Picks

AUD/USD bulls seek a break of 0.6925 for 0.6950 target area

AUD/USD bulls seek a break of 0.6925 for 0.6950 target area

AUD/USD is consolidated at the start of the Asian day following some back and forth at the start of the week. The Aussie is trading at 0.6922 and will be dependent on the trajectory of the greenback in the absence of domestic data this week other than Retail Sales tomorrow. 


EUR/USD retreats from fortnight high near 1.0600 on recession/inflation fears

EUR/USD retreats from fortnight high near 1.0600 on recession/inflation fears

EUR/USD holds onto the pullback from a two-week high as bulls get rejections from short-term key resistances, as well as risk-off mood, during Tuesday’s Asian session. The major currency pair remains pressured around 1.0585.


Gold sees downside below $1,820, focus shifts to Fed Powell

Gold sees downside below $1,820, focus shifts to Fed Powell

Gold price displayed a failed attempt to sustain above the critical resistance of $1,840.00 on Monday. The precious metal has turned sideways after a sheer downside move and is expected to extend its losses after violating the crucial support of $1,820.85.

Gold News

Terra’s LUNA price finally shows the buy signal you’ve been waiting for

Terra’s LUNA price finally shows the buy signal you’ve been waiting for

Terra’s LUNA price shows optimism to start the final week of June. The potential for a new bull run is beginning to materialize. LUNA price sees an uptick in social media commentary.

Read more

FXStreet Premium users exceed expectations

FXStreet Premium users exceed expectations

Tap into our 20 years Forex trading experience and get ahead of the markets. Maximize our actionable content, be part of our community, and chat with our experts. Join FXStreet Premium today!