NZD/USD eyes to fill the week-start gap below 0.6750 amid Russia-Ukraine stand-off

• NZD/USD begins the week with a downside gap, picks up bids of late.
• Russian central bank sanctions, West united to cut some banks from Moscow from SWIFT.
• Talks between Ukraine and Russia trigger cautious optimism as well.
• Second-tier NZ, US data may decorate today’s calendar, Moscow-Kyiv headlines are the key.

NZD/USD began the week’s trading with a downside gap to 0.6664 as markets reacted to the weekend news with a stark risk-off mood. However, the kiwi pair regains upside momentum afterward and is currently taking the bids around 0.6700 amid hopes of easing tensions between Russia and Ukraine. That said, the quote rose for the consecutive four weeks in the last.

The Western leaders finally agreed to cut some of the Russian banks from the SWIFT international payment system, also marked sanctions on the Russian central bank, to portray their dislike of Moscow’s invasion of Ukraine. In a reaction, Russian President Vladimir Putin puts nuclear deterrence forces on high alert and offered another blow to the market sentiment.

However, headlines conveying the Ukraine-Russia peace talks, at the Belarus-Ukrainian border, seemed to have offered a sigh of relief as the Asian markets gain momentum on Monday morning.

Hence, risk appetite witnessed a heavy blow at the start but the mood is improving as traders gain news headlines on the key geopolitical issues, which in turn helps NZD/USD to pare the week-start losses.

That said, markets printed heavy risk-off during the last week but the Reserve Bank of New Zealand’s (RBNZ) hawkish tone and a 0.25% rate-hike seems to have helped the kiwi pair a fourth weekly upside by the end of Friday’s trading.

Moving on, risk catalysts keep the driver’s seat and will direct immediate NZD/USD moves. However, ANZ Business Confidence and Activity Outlook data for February may offer immediate directions to the pair traders. Following that, the US trade numbers for January and Chicago Purchasing Managers’ Index for February will decorate the daily calendar. That said, major attention will be given to Tuesday’s China PMIs for February and Friday’s US jobs report, not to forget the Russia-Ukraine headlines.

Technical analysis

NZD/USD bears need to remain cautious until witnessing a clear downside break of the monthly support line, around 0.6650 by the press time.