NZD/USD bulls regain control, reclaims 0.73 handle and beyond

   •  Renewed USD weakness helps rebound from 2-1/2 week lows.
   •  A minor recovery in European equities prompts short-covering.
   •  Focus shifts to this week’s NZ jobs data/RBNZ decision. 

The NZD/USD pair built on its solid intraday recovery from 2-1/2 week lows and was now seen building on its gains further beyond the 0.7300 handle.

The pair stalled the post-NFP retracement from the 0.7400 handle and was able to find decent support ahead of mid-0.7200s. Currently trading around the 0.7315-20 region, testing session tops, the pair has now reversed all of its previous session's losses and was being supported by some renewed US Dollar weakness. 

Some initial signs of stability in the global financial market, with European equities paring some of their daily losses, still deep in the red, further seem to have prompted a short-covering move around perceived riskier/higher-yielding currencies - like the Kiwi. 

It, however, remains to be seen if the up-move is backed by any genuine buying or is solely led by some short-covering move as investors' focus shifts to the upcoming NZ employment details and the key RBNZ monetary policy meeting on Wednesday and Thursday respectively.

Technical levels to watch

A follow-through buying interest beyond 0.7330 level (yesterday's high) should assist the pair to make a fresh attempt towards reclaiming the 0.7400 handle. On the flip side, weakness back below the 0.7300 handle now seems to find immediate support near the 0.7285 level, below which the pair is likely to break below mid-0.7200s and head towards testing 0.7220 support area.