Home NZD/USD hits 1-week tops, levels beyond mid-0.6300s
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NZD/USD hits 1-week tops, levels beyond mid-0.6300s

  • The USD retreats farther from multi-year tops despite a pickup in the US bond yields.
  • The prevalent risk-on mood provided an additional boost and remained supportive.

The NZD/USD pair built on the previous session’s solid bounce from near four-year lows and climbed to one-week tops, beyond mid-0.6300s on Wednesday.

Weaker USD/risk-on mood remains supportive

The pair continued gaining positive traction for the second consecutive session on Wednesday and remained well supported by a follow-through US Dollar pullback from multi-year tops. Despite a goodish pickup in the US Treasury bond yields, the greenback failed to attract any buying interest and remained on the defensive, which eventually drove the pair higher.
 
This coupled with improving global risk sentiment – as depicted by a positive trading sentiment across European equity markets – provided an additional boost to perceived riskier currencies – like the Kiwi – and further collaborated to the pair’s ongoing strong recovery of nearly 100-pips from the overnight swing lows near the 0.6270 region – level not seen since September 2015.
 
Meanwhile, the latest leg of a sudden pick up over the past hour or so could further be attributed to some follow-through technical buying on a sustained move beyond the Asian session tops. Hence, a follow-through up-move, towards reclaiming the 0.6400 round figure mark, now looks a distinct possibility amid absent relevant market-moving US economic releases.

Technical levels to watch

 

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