NZDUSD remains bid on Monday, pushing against 0.5940 resistance area

• New Zealand's dollar returns to the 0.5940 resistance area.
• Rumors of easier COVID-19 restrictions in China have boosted risk appetite.
• Investors' optimism is weighing on the safe-haven US dollar.

The New Zealand dollar has opened the week on the same positive tone that closed the last one. The pair bounced up at 0.5870 on Monday's early trade, to return towards the seven-week high at the 0.5940 area, which, so far, is holding upside attempts

Rumors of easier COVID-19 restrictions in China

With a considerably thinner economic calendar ahead this week, market rumors suggesting that Chinese authorities would be easing coronavirus restrictions have boosted optimism on Monday, supporting riskier assets to the detriment of the safe-haven USD.

European stock markets have witnessed a strong opening, although the enthusiasm has eased somewhat after the Chinese National Health Commission denied the rumors and warned about severe restrictions ahead as the winter flu season approaches. US stocks are moderately positive, with the Dow Jones Index advancing 0.84%, the S&P ticking up 0,35%, and the Nasdaq Index 0.70% above opening levels at the time of writing

Market sentiment, however, remains moderately positive, with the investors still assessing Friday’s strong US NoN-Farm Payrolls report. Private sector payrolls increased by 264,000 in October, beating expectations of a 200,000 increment, while September’s reading was revised up to 315,000 from the previous estimate of 264,000.

The market is at a crossroads amid the contradictory news from China, with major currency crosses at key levels. In this context, some hesitation should be contemplated, as the investors may seek further data before placing significant bets in either direction.

In that case, US Consumer Inflation figures could offer further insight into the US Federal Reserve’s next monetary policy decision and thus increase USD volatility.

Technical levels to watch