• NZD/USD recovers further from last week’s losses.
• Price still remains under the 200-day moving average.

The NZD/USD is rising for the second day in a row, extending the recovery from the lowest level since November it reached on Friday at 0.6922. It recently printed a fresh daily high above 0.7000 as the bullish tone prevails.

The pair is trading at 0.7006, at the daily top ahead of Fed’s Chair Powell presentation. He will speak at the US Congress before a House committee on the response to the coronavirus, starting around 18:00 GMT. In his prepared remarks, he mentioned they are not concern about the rising rise in inflation readings.

Powell’s words come after last week's FOMC meeting that triggered a sharp rally of the US dollar across the board. The greenback peaked on Thursday and pulled back over the last two days. The DXY failed to hold to gains on Tuesday and is back under 92.00 as US yields move off highs.

From a technical perspective, the NZD/USD still holds a dominant bearish bias, but the recovery still has momentum in the short-term. The next strong resistance might be seen at 0.7035/40, the 200-day moving average. A recovery above 0.7060 would alleviate the bearish pressure. On the flip side, a slide under 0.6960 should clear the way for a test of the recent low.

Technical levels