NZD/USD is back up to test the recent highs and remains the best performer. NZD/USD has been in on the front foot, leading the way since the start of the week and the recovery of the bearish opening gap across the antipodeans. The bird has rallied from 0.6843 and up to 0.7055 the highs in that recovery. Underpinning the commodity sector was the comeback that oil had made yesterday and over the intra-sessions. Fundamentally, the greenback has lost ground over the uncertainty around the Fed's progress on normalising rates. Whether the recovery can continue up to 9th Junes bearish gap and onto the 0.79 handle will now very much depend on the RBNZ next week, in the absence of further bullish catalysts for the rest of this week. The RBNZ surprised markets last month and cut rates to a record low of 2.25%, sparking a knee-jerk 1% sell-off in the Kiwi. Within the central bank's statement, the RBNZ's governor Graeme Wheeler emphasised that New Zealand's dairy industry faced "difficult challenges", but "domestic growth is expected to be supported by strong inward migration, tourism, a pipeline of construction activity and accommodative monetary policy". He explained that the main threats to New Zealand's economy as "a decline in inflation expectations, weakness in the dairy sector, the possibility of continued high net immigration, and pressures in the housing market". Wheeler also the door open for more interest rate cuts, suggesting, "further policy easing may be required to ensure that future average inflation settles near the middle of the target range". In respect to dairy, today's auction ended with a gain in the GDT (GlobalDairyTrade) Price Index up 3.8%. NZD/USD levels NZD/USD is up on the 0.70 handle meeting resistance at 0.7050/55. where doe sit go from here? "The unexpected strong rally clearly bodes well for NZD, but we prefer to wait for a daily closing above 0.7000 before turning bullish. This appears to be a likely scenario unless there is a move back below 0.6870 in the next 1 to 2 days," explained analysts at UOB Group. The next pit stop on such a scenario could be a test of aforementioned 9th June daily stick, between 0.7107 and 0.7231 while failures could engage supply back to the 20 dma at 0.6842 as a key support level within this recent rally in April. For more information, read our latest forex news.