NZD/USD attempting gains above 0.7000

The NZD/USD pair is seen extending its recovery from multi-month troughs into a second day today, trying hard to build on gains above 0.70 handle amid broad based US dollar strength.

NZD/USD looks to test Thursday’s high

Currently, the NZD/USD pair trades +0.09% higher near fresh session highs of 0.7011, recovering from daily lows struck at 0.6985 in early Asia. The Kiwi benefits from a risk-friendly market environment, as traders take the yield advantage, despite the ongoing rally in the treasury yields. Higher treasury yields diminish the attractiveness of emerging markets currencies as an alternative higher-yielding asset.

Additionally, the sentiment around the NZD also remain underpinned following the release of above estimates NZ trade figures, sending NZD/USD back above 0.70 handle. Also, a minor-retreat in the greenback against most of its majors collaborated to the upbeat momentum seen around NZD/USD.

Looking ahead, with the NZ trade data out of the way, markets now look forward to the US economic releases amid extension of holiday-thinned trading. The US markets re-open today after Thanksgiving Day observed yesterday, but the bond markets will remain open half-day today.

NZD/USD Levels to consider

To the upside, the next resistance is located at 0.7022/31 (previous high/ 5-DMA), above which it could extend gains to 0.7052 (daily R2) and from there to 0.7100 (round figure). To the downside immediate support might be located at 0.6985 (daily low) and from there to at 0.6949 (July low), below which 0.6900 (zero figure) would be tested.

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