NZD/USD advances ahead of FOMC minutes, USD weak

The NZD/USD trades at 0.6168 with a 0.28% gain during Tuesday's session.
Markets await the FOMC minutes from January’s meeting.

Patricio Martín FXStreet

In Tuesday's session, the NZD/USD was viewed at 0.6168, marking a modest gain of 0.28% mainly driven by a weak US Dollar.

In line with that, the US Dollar's strength has slightly declined as well as Treasury yields before the release of the Federal Open Market Committee (FOMC) minutes. These minutes, set for release in Wednesday’s session, hold market attention as they provide insights into the central bank's perspective on inflation and the potential need for policy adjustments. It's noteworthy that markets currently predict around four rate cuts in 2024, totaling to an estimated 100bps, set to start from June.

NZD/USD technical analysis

On the daily chart, the Relative Strength Index (RSI) recently turned neutral to positive, increasing from negative territory over the last few days. This suggests an uptick in buying activity as buyers regained some control from sellers. However, the RSI remains within positive territory indicating the market could still fluctuate from balanced to buyer-dominated conditions. The Moving Average Convergence Divergence (MACD) also suggests that the buyers are in command with its rising green bars.

The broader upward trend (evidenced by the pair being above the 20, 100, and 200-day Simple Moving Averages) further supports the bullish signals from the RSI and MACD.

NZD/USD daily chart

Author

Patricio Martín

FXStreet

Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.

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