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  • NZD/USD struggles to keep the bounce-off yearly low.
  • Strength of Kiwi fundamentals seems to have faded as US economics and chatters over tapering are all around.
  • US dollar rallies to mid-November top even as Treasury yields recover.
  • Vaccine, stimulus and virus have been can the bulls amid a light calendar.

NZD/USD takes rounds to the lowest since November 2020, marked the previous day, while flashing 0.6955 amid the initial Asian session on Friday. Despite snapping a three-day losing streak, kiwi bulls couldn’t mark a return as the US dollar strength dominates market moves.

Backseat for Auckland?

Although New Zealand’s economy is still the strongest when it comes to tackling the coronavirus (COVID-19) pandemic, recently positive signs from America have been challenging the kiwi bulls. Thursday’s upbeat US GDP and Jobless Claims joins the hopes of further stimulus from US President Joe Biden and faster vaccinations to flash more positives for the world’s largest economy.

It’s worth mentioning that the US is up for inflating the vaccine targets while the European Union (EU) recently conveyed fears of a third wave of the covid. Furthermore, geopolitical and trade risks emanating from Iran, North Korea and China are an extra burden on the NZD/USD prices.

Amid these plays, the US 10-year Treasury yields grew 1.9 basis points to 1.63% while defying the three-day losing streak. On the same line, Wall Street took a sigh of relief, even with mild gains, as the $3.0 trillion infrastructure spending plan gains more hits.

Considering an absence of a crucial catalyst up for publishing, NZD/USD moves are likely to rely on the US dollar performance. However, updates concerning the virus, vaccine, trade and geopolitics will be the key. It should be noted that the taper tantrum is a hot topic and more hints for the same can strengthen the US dollar.

Technical analysis

Unless successfully trading beyond the 0.7000 threshold, NZDUSD stays vulnerable to test 200-day SMA level near 0.6870.