NZD/USD clings to strong daily gains around 0.7170

• NZD/USD is registering gains for the third straight day.
• US Dollar Index struggles to gain traction after upbeat US data.
• Upbeat market mood is helping NZD/USD stay bullish.

The NZD/USD pair rose to its highest level in nearly four weeks at 0.7181 during the European trading hours on Thursday and staged a technical correction before regaining its traction. As of writing, the pair was up 0.45% on the day at 0.7170.

USD fails to capitalize on strong data

Although the macroeconomic data releases from the US confirmed the strong economic rebound, the greenback struggled to gather strength amid the sharp decline witnessed in the US Treasury bond yields.

The US Department of Labor reported on Thursday that the weekly Initial Jobless Claims dropped to its lowest level in a year at 576,000. Additionally, the US Census Bureau’s monthly publication revealed that Retail Sales, which contracted by 2.7% in February, surged by 9.8% in March, surpassing the market expectation for an increase of 5.9%. With the initial reaction, the US Dollar Index advanced to a daily high of 91.73 but reversed its direction to turn flat around 91.65 in the last hour.

In the meantime, the positive shift witnessed in risk sentiment, as reflected by Wall Street’s main indexes’ impressive gains, is helping NZD/USD preserve its bullish momentum.  

On Friday, the Business NZ PMI data from New Zealand will be looked upon for fresh impetus.

Technical levels to watch for