NZD/USD firmer, eyes multi-week tops ahead of NZ jobs

The New Zealand dollar extends its bullish momentum versus its American counterpart for the third straight session today, now the NZD/USD pair further towards twelve-week highs reached last week at 0.7317.

Currently, the NZD/USD pair trades +0.0.08% higher at 0.7293, flirting with daily highs of 0.7398. The major is on the rise mainly driven by the recent weakness surrounding the greenback, in light of mounting concerns over Trump’s economic policies, with latest one being the immigration curbs.

While strong NZ fundamentals and rising dairy prices continue to offer some yield advantage to the markets amid prevalent risk-off conditions and weaker oil prices. Focus now remains on the US macro news due later today, while tomorrow’s NZ jobs report will provide fresh direction on the spot.

Analysts at ING noted, “Domestic focus shifts to the Dec trade balance (Tue) and 4Q jobs data (Wed). Scope for a Fed-driven move higher in US yields means NZD/USD risks remain skewed to the downside. Look for the pair to run into strong resistance around the 0.7300/50 area.”

NZD/USD Levels to consider

To the upside, the next resistance is located at 0.7310/17 (daily R1/ 12-week highs), above which it could extend gains to 0.7350 (psychological levels) and from there to 0.7400 (zero figure). To the downside immediate support might be located at 0.7272 (5-DMA) and from there to at 0.7250 (10-DMA), below which 0.7208 (daily S2) would be tested.