The Central Bank of New Zealand left interest rates unchanged at 0.25% last Wednesday. This would normally indicate a bearish bias among traders, but the opposite happened. The Kiwi dollar (the NZD is called the Kiwi because of the kiwi bird depicted on its $1 coin) has risen steadily against the US dollar for three weeks in a row. Probably due to investors' growing appetite for riskier instruments and the central bank's less dovish tone in its latest statement. Economic indicators such as high consumer spending, asset prices and employment show a positive response to the policy response to Covid. If this recovery continues, it would provide further support for the New Zealand dollar.
The NZDUSD pair is currently trading at the resistance level around 0.6930. The upper boundary of this area is 0.7055. Let's see how many bears will step in to push the rate lower and try to break the uptrend. They will have to contend with support areas from 0.6600 to 0.6400. If the recovery continues and the Kiwi strengthens further above the 0.7055 level, the next resistance level will be around the 0.7220 - 0.7400 area. The NZD often trades in tandem with the Australian Dollar (AUD), so it is worth watching both currencies for similarities that traders can use to their advantage.