NZD/USD rebounds above 0.7000, remains on track to post weekly losses
- NZD/USD staged a decisive rebound in the American session.
- US Dollar Index struggles to hold above 92.50.
- NZD/USD remains on track to close the week in the negative territory.
The NZD/USD pair dropped below 0.6950 in the early American session but managed to make a sharp U-turn. As of writing, the pair was trading at 0.7003, where it was up 0.38% the day. On a weekly basis, NZD/USD remains on track to close in the negative territory despite Friday’s rebound.
The renewed USD weakness seems to have fueled NZD/USD’s rally in the second half of the day. The US Bureau of Labor Statistics reported on Friday that Nonfarm Payrolls increased by 850,000 in June. Although this reading beat the market expectation of 700,000 is failed to help the greenback gather strength.
Further details of the jobs report showed that the Labor Force Participation Rate stayed unchanged at 61.6% and the Unemployment Rate edged higher to 5.9% from 5.8% in May. Following an immediate spike to a multi-month high of 92.74, the US Dollar Index lost its traction and was last seen losing 0.1% at 92.44.
NZD/USD near-term outlook
Credit Suisse analysts think that NZD/USD could extend its slide with a move below the 0.6945/23 area.
“The ‘measured objective’ to the in-range top still projects a move to 0.6913, which suggests this breakdown will be seen, opening up 0.6875/61 next, with the next initial support then seen at 0.6810/00,” analysts added. “Near-term resistance moves to 0.7052/57, then 0.7096/20, which is the ‘neckline’ to the previously highlighted short-term top, which we look to hold if reached. Above here the next level is seen at 0.7161/74, above which would negate the top.”
Additional levels to watch for