NZD/USD climbs back to 0.7300 ahead of NZ jobs report

• NZD/USD back above 0.7300.
• Key events ahead: NZ Employment data and RBNZ. 
• Technicals point lower in the short-term. 

The NZD/USD pair rose back above 0.7300 during the American session amid a weaker US dollar and a stabilization in Wall Street. Ahead of the release of the New Zealand employment report, it was trading at 0.7310. 

During yesterday’s Wall Street crash NZD/USD dropped moderately and bottomed today during the Asian session at 0.7255, the lowest since January 18. The recovery of equity prices and a retreat of the greenback pushed the pair to the upside. The recovery found resistance at 0.7315.

Two key events are on the radar for NZD: the Q4 NZ Employment report and tomorrow the RBNZ decision. The unemployment rate is expected to remain at 4.6% and employment to rise by 0.2% with a decline in the participation rate to 70.8%. Better-than-expected data could boost the Kiwi but any impact could be offset or reinforced by the RBNZ statement the day after. 

“The RBNZ is widely expected to leave the key interest rates at record lows for about another year, as the tight labor market in New Zealand is not enough to press on prices to rise”, said Mario Blascak, European Chief Analyst. 

NZD/USD levels to watch 

Despite the rebound, NZD/USD continues to move with a bearish bias. The recent move to the upside was capped by the 20-SMA in four-hour charts that stand at 0.7320.  A consolidation on top could change the short-term tone and open the doors for a rise to 0.7375 and above for a test of 0.7400. 

While below 0.7315/20, the bearish bias is likely to remain intact. On the downside, under 0.7300, the weekly low at 0.7255 would be exposed. Below the next strong support might be seen at 0.7225.