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NZD/USD consolidates in a range around 0.6000, seems vulnerable amid bullish USD

  • NZD/USD struggles to gain any meaningful traction and oscillates in a range.
  • Aggressive Fed rate hike bets revive the USD demand and act as a headwind.
  • A positive risk tone seems to be the only factor that lends support to the pair.

The NZD/USD pair struggles to capitalize on the previous day's modest bounce from the 0.5975 area and oscillates in a range through the early European session on Thursday. The pair is currently hovering around the 0.6000 psychological mark and remains well within the striking distance of its lowest level since May 2020 touched the previous day.

Signs of stability in the equity markets turn out to be a key factor offering some support to the risk-sensitive kiwi. That said, the emergence of fresh US dollar buying acts as a headwind for the NZD/USD pair. Tuesday's stronger US CPI report lifted bets for a more aggressive policy tightening by the Fed, which, in turn, continues to underpin the greenback.

The implied odds for a full 1% lift-off at the next FOMC meeting on September 20-21 currently stand at 30%. Moreover, the markets expect the Fed to deliver another supersized 75 bps rate hike in November. This remains supportive of elevated US Treasury bond yields and favours the USD bulls, supporting prospects for a further downside for the NZD/USD pair.

That said, a positive risk tone caps gains for the safe-haven greenback and warrants some caution for aggressive traders. Market participants now look forward to the US economic docket, featuring Retail Sales figures, Weekly Initial Jobless Claims, Regional Manufacturing Indices, and Industrial Production data later during the early North American session.

This, along with the US bond yields and the broader risk sentiment, might influence the USD price dynamics and provide some impetus to the NZD/USD pair. The focus, however, remains on next week's highly-anticipated FOMC monetary policy meeting.

Technical levels to watch

NZD/USD

Overview
Today last price0.6007
Today Daily Change0.0004
Today Daily Change %0.07
Today daily open0.6003
 
Trends
Daily SMA200.6126
Daily SMA500.6204
Daily SMA1000.6286
Daily SMA2000.6532
 
Levels
Previous Daily High0.6025
Previous Daily Low0.5976
Previous Weekly High0.6153
Previous Weekly Low0.5996
Previous Monthly High0.647
Previous Monthly Low0.6101
Daily Fibonacci 38.2%0.6006
Daily Fibonacci 61.8%0.5995
Daily Pivot Point S10.5977
Daily Pivot Point S20.5952
Daily Pivot Point S30.5928
Daily Pivot Point R10.6027
Daily Pivot Point R20.605
Daily Pivot Point R30.6076

Author

Haresh Menghani

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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