- Some renewed USD selling assisted NZD/USD to stage a goodish bounce from 2-1/2-week lows.
- The upbeat market mood undermined demand for the safe-haven USD and remained supportive.
- Sustained move beyond the 0.6500 mark will set the stage for a move towards multi-month tops.
The NZD/USD pair continued scaling higher through the mid-European session and shot to fresh daily tops, around the 0.6475-80 region in the last hour.
Following a bearish gap opening at the start of a new trading week, the pair staged a goodish recovery from 2-1/2-week lows. The intraday positive move was supported by the upbeat market mood, which tends to benefit perceived riskier currencies, including the kiwi.
The financial markets, so far, have been resilient to a surge in COVID-19 infections, especially in Latin America and across the US ‘sunbelt’. Moreover, the World Health Organization (WHO) on Sunday reported a record increase in new coronavirus cases globally.
The risk-on flow was evident from a positive trading mood around the US equity futures. This led to an intraday US dollar turnaround from three-week tops and was seen as one of the key factors behind the NZD/USD pair’s strong bounce of over 90 pips from daily lows.
The pair was last seen hovering around the 0.6475-80 supply zone, which is closely followed by the key 0.6500 psychological mark. Some follow-through strength should pave the way for a move back towards multi-month tops, around the 0.6585 region set earlier this month.
Moving ahead, market participants now look forward to the only release of Existing Home Sales figures from the US. The data might influence the USD price dynamics and produce some short-term trading opportunities during the early North American session.
Technical levels to watch
Share
