NZD/USD Price Analysis: Remains inside woods ahead of Fed policy


  • NZD/USD trades in a narrow range as investors await the Fed’s interest rate policy.
  • The Fed is expected to keep interest rates unchanged amid falling inflation.
  • NZD/USD trades in an Ascending Triangle chart pattern, which indicates a squeeze in volatility.

The NZD/USD pair has oscillated in a narrow range of 0.5900-0.5940 for the past four trading sessions. The Kiwi asset struggles to find as investors await the interest rate decision by the Federal Reserve (Fed), which will be announced on Wednesday.

The US Dollar Index (DXY) faces barricades in extending recovery further as the Fed is expected to deliver a neutral interest rate policy. The US economy is resilient due to easing inflationary pressures and stable labor growth, which would allow Fed policymakers to keep interest rates unchanged at 5.25-5.50%.

Meanwhile, the New Zealand Dollar will dance to the tune of the People’s Bank of China (PBoC) monetary policy, which is also scheduled for Wednesday. The PBoC is expected to continue to favor an expansionary policy framework to diminish deflation risks. Being a proxy for China’s economic recovery, an expansionary policy would support the New Zealand Dollar.

NZD/USD trades in an Ascending Triangle chart pattern on a two-hour scale, which indicates a squeeze in volatility. The upside of the aforementioned chart pattern is restricted near the horizontal resistance plotted from September 6 high at 0.5942 while the upward-sloping trendline is placed from September 7 low at 0.5847.

The 50-period Exponential Moving Average (EMA) at 0.5914 is extremely close to the asset, portraying a sideways trend.

Meanwhile, the Relative Strength Index (RSI) (14) attempts to shift into the bullish range of 60.0080.00. If the RSI (14) manages to do so, a bullish momentum will get triggered.

Going forward, a decisive break above September 14 high at 0.5945 would expose the asset to August 23 high around 0.5980, followed by August 8 low around 0.6035.

On the contrary, a breakdown below September 13 low at 0.5980 would drag the major toward September 7 low at 0.5847. A slippage below the latter would expose the asset to the round-level support at 0.5800.

NZD/USD two-hour chart

NZD/USD

Overview
Today last price 0.5937
Today Daily Change 0.0019
Today Daily Change % 0.32
Today daily open 0.5918
 
Trends
Daily SMA20 0.5921
Daily SMA50 0.6048
Daily SMA100 0.6109
Daily SMA200 0.6197
 
Levels
Previous Daily High 0.5922
Previous Daily Low 0.5894
Previous Weekly High 0.5945
Previous Weekly Low 0.588
Previous Monthly High 0.6219
Previous Monthly Low 0.5885
Daily Fibonacci 38.2% 0.5911
Daily Fibonacci 61.8% 0.5905
Daily Pivot Point S1 0.59
Daily Pivot Point S2 0.5883
Daily Pivot Point S3 0.5872
Daily Pivot Point R1 0.5928
Daily Pivot Point R2 0.5939
Daily Pivot Point R3 0.5956

 

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

EUR/USD retreats toward 1.0850 on modest USD recovery

EUR/USD retreats toward 1.0850 on modest USD recovery

EUR/USD stays under modest bearish pressure and trades in negative territory at around 1.0850 after closing modestly lower on Thursday. In the absence of macroeconomic data releases, investors will continue to pay close attention to comments from Federal Reserve officials.

EUR/USD News

GBP/USD holds above 1.2650 following earlier decline

GBP/USD holds above 1.2650 following earlier decline

GBP/USD edges higher after falling to a daily low below 1.2650 in the European session on Friday. The US Dollar holds its ground following the selloff seen after April inflation data and makes it difficult for the pair to extend its rebound. Fed policymakers are scheduled to speak later in the day.

GBP/USD News

Gold climbs to multi-week highs above $2,400

Gold climbs to multi-week highs above $2,400

Gold gathered bullish momentum and touched its highest level in nearly a month above $2,400. Although the benchmark 10-year US yield holds steady at around 4.4%, the cautious market stance supports XAU/USD heading into the weekend.

Gold News

Chainlink social dominance hits six-month peak as LINK extends gains

Chainlink social dominance hits six-month peak as LINK extends gains

Chainlink (LINK) social dominance increased sharply on Friday, exceeding levels seen in the past six months, along with the token’s price rally that started on Wednesday. 

Read more

Week ahead: Flash PMIs, UK and Japan CPIs in focus – RBNZ to hold rates

Week ahead: Flash PMIs, UK and Japan CPIs in focus – RBNZ to hold rates

After cool US CPI, attention shifts to UK and Japanese inflation. Flash PMIs will be watched too amid signs of a rebound in Europe. Fed to stay in the spotlight as plethora of speakers, minutes on tap.

Read more

Forex MAJORS

Cryptocurrencies

Signatures