NZD/USD flirting with lows, inching back closer to 0.71 handle

The NZD/USD pair traded with a mild bearish bias through Asian session and eroded part of Friday's strong gains to 4-month tops, currently placed at session lows around 0.7115 region.

A modest recovery in the US treasury bond yields helped the key US Dollar Index to recovery from its lowest level since the US Presidential election in November, touched in the aftermath of disappointing headline NFP print, and weighed on higher-yielding currencies - like the Kiwi.

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Adding to this, a slight deterioration in investors' risk appetite, in wake of a weekend terrorist attack in London, boosted the greenback's safe-haven appeal against the New-Zealand Dollar and further collaborated to the offered tone surrounding the major.

Looking at the broader picture, the pair on Friday's decisively broke through the very important 200-day SMA for the first time since early March and hence, any downslide might now be looked upon as a buying opportunity amid fading expectations for an aggressive Fed rate tightening cycle through 2017. 

Today's US economic docket features the release of revised nonfarm productivity, ISM non-manufacturing PMI and factory orders data, which would help traders to grab some short-term trading opportunities. 

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Technical levels to watch

From current levels, the 0.7100 handle (200-day SMA) is likely to act as immediate support, which if broken could drag the pair back towards 100-day SMA support near 0.7055 region with some intermediate support around 0.7080 level.

On the upside, 0.7145-50 area now seems to have emerged as immediate strong hurdle, above which the pair seems all set to aim towards reclaiming the 0.7200 handle before heading towards its next resistance near 0.7225-30 region.