The Kiwi has become stable in the recent trade after pulling back sharply from Asia Pacific/early European session highs in the 0.6840 area to current levels in the 0.6780s.
Liquidity conditions remain thin amid the absence of many Asia Pacific and European market investors. Markets in the UK, Australia, New Zealand, Canada, Japan, and China were all closed on Monday. A break below support around current levels for NZD/USD would likely signal continued drop back towards December lows around 0.6700. NZD/USD’s failure to break above trendline resistance last week in the mid-0.6800s seems to have been taken as a bearish signal. The main drivers of the pair and FX markets more broadly this week will be the key US December jobs report, as well as the December ISM surveys.
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