NZD / USD recovery extends above October high at 0.6680

• The NZD / USD bounce from 0.6635 has reached new one-month highs above 0.6680.
• Kiwifruit holding firm amid broad USD rally.
• NZD / USD seen trapped between 0.6570 and 0.6700.

The New Zealand dollar It has resumed its uptrend from Tuesday’s lows at 0.6550 and is on track to post its second consecutive positive day after ignoring a negative open and hitting month-long highs at 0.6688.

Kiwi extends gains despite strong US dollar

The NZD has held steady against the overall strength of the US dollar amid negative market sentiment. Trump’s comments blaming Democrats for a lack of progress in the US stimulus negotiations have reduced risk appetite during the Asia and Europe sessions and fueled the return of the US dollar.

The NZD / USD retracement, however, held at 0.6630, about 40 pips below Wednesday’s high. The pair has managed to rally with risk aversion waning during the US session and markets appearing in positive territory, to explore levels beyond 0.6680 for the first time since late September, although the advance has yet to be confirmed.

NZD / USD bullish attempts expected to be capped below 0.6700 – UOB

From a technical perspective, the UOB currency analysis team remains skeptical about the chances of a sustained rally in the NZD, expecting the pair to remain trapped between 0.6570 and 0.6700: “We have held the same opinion since last Friday (16 de October – 0.6600) in which ‘the downward momentum has tentatively improved; The NZD has to close below 0.6570 before a more sustained bearish move can be expected. “The NZD fell to a low of 0.6555 on Tuesday (Oct 20) but did not close below 0.6570. The break of 0.6660 yesterday indicates that the recent slight downward pressure has eased. The current move is considered part of a consolidation phase and the NZD is likely to trade within a 0.6560 / 0.6700 range for now. ”