NZD/USD: bears eyeing for a break below 0.70 handle

The NZD/USD pair came under some selling pressure and has now moved on the brink of breaking back below the 0.70 psychological mark. 

A modest recovery in the US treasury bond yields was seen lending support to the US Dollar. Adding to this, the prevalent cautious environment weighed on riskier / higher-yielding currencies - like the Kiwi. 

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Meanwhile, bearish sentiment surrounding commodity space failed to assist the pair to build on its recent up-move to the highest level since March 27. Investors also seem to have digested yesterday's upbeat release of GDT price index, showing a third consecutive rise in dairy prices.

With today’s downslide the pair has now stalled its ongoing recovery move last week’s four-week low to three-week highs touched early today. The pair also seems to have faced rejection near 50-day SMA immediate strong hurdle near mid-0.700s. Hence, a follow through retracement would point to resumption of the pair’s prior weakening trend. 

Today’s US economic dockets lacks any major market moving releases and hence, the broader market risk-sentiment and the US Dollar price-dynamics would remain key determinants of the pair’s movement on Wednesday. 

Technical levels to watch

Bears would be eyeing for a break through 0.70 mark, below which the pair is likely accelerate the slide towards 0.6960-55 horizontal support ahead of 0.6920 level. On the upside, momentum above 0.7040-50 resistance (50-day SMA) could get extended towards 100-day SMA hurdle near 0.7080 before the pair eventually moves beyond the 0.7100 handle and aims towards testing 200-day SMA strong hurdle near 0.7140 region.