The NZDUSD currency pair, currently trading at 0.59509, experiences a rebound in a positive direction on Monday and is aided by the muted movement of the USD.

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• NZD/USD regains positive traction on Monday and is supported by subdued USD price action.

The pair currently trades last at 0.59509.

The previous day high was 0.6015 while the previous day low was 0.5934. The daily 38.2% Fib levels comes at 0.5965, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.5984, expected to provide resistance.

The NZD/USD pair attracts fresh buying on the first day of a new week and stalls Friday’s retracement slide from the 0.6015 area, or its highest level since August 11. Spot prices trade around the 0.5950-0.5955 region during the Asian session, up nearly 0.20% for the day, and draw support from a subdued US Dollar (USD) price action.

The mixed US monthly jobs report released on Friday ensures that the Fed will leave rates unchanged at its September meeting and fails to assist the USD to capitalize on last week’s strong move up back closer to the August monthly swing high. Apart from this, the optimism over more supportive measures from China to shore up economic growth boosts investors’ confidence and benefits antipodean currencies, including the New Zealand Dollar (NZD).

In fact, China’s top economic planner – the National Development and Reform Commission (NDRC) – said that it would establish a designated department to bolster the country’s faltering private economy. This comes after China increased local dollar liquidity and loosened some mortgage rules last week, which remains supportive of a positive tone around the equity markets. The upbeat mood further undermines the safe-haven buck and benefits the risk-sensitive Kiwi.

The upside for the NZD/USD pair, however, seems limited, warranting some caution for bullish traders and before positioning for any meaningful appreciating move in the near term. The markets seem convinced that the Fed will keep interest rates higher for longer and are still pricing in the possibility of one more 25 bps lift-off by the end of this year. The hawkish outlook continues to act as a tailwind for the Greenback and should keep a lid on any further gains for the major.

In the absence of any relevant market-moving economic releases and a bank holiday in the US, the aforementioned fundamental backdrop makes it prudent to wait for strong follow-through buying to confirm that the NZD/USD pair has bottomed out.

Technical Levels: Supports and Resistances

NZDUSD currently trading at 0.5951 at the time of writing. Pair opened at 0.5946 and is trading with a change of 0.08 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 0.5969, 50 SMA 0.6103, 100 SMA @ 0.6138 and 200 SMA @ 0.6221.

The previous day high was 0.6015 while the previous day low was 0.5934. The daily 38.2% Fib levels comes at 0.5965, expected to provide resistance. Similarly, the daily 61.8% fib level is at 0.5984, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.5915, 0.5884, 0.5834
• Pivot resistance is noted at 0.5996, 0.6046, 0.6077

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