NZD/USD seesaws near 2-week top, all eyes on RBNZ

NZD/USD remains under pressure ahead of the RBNZ.
Markets expect a dovish rate statement considering the latest global support for easy monetary policy.
The sustained trading above 0.6610 favors the quote’s upside from the technical aspect.

Anil Panchal FXStreet

Despite trimming some gains on the back of less dovish rhetoric from the Fed policymakers, the NZD/USD still stays strong near 2-week high while taking the rounds to 0.6640 at the start of Wednesday’s Asian session. Investors now await monetary policy meeting decision from the Reserve Bank of New Zealand (RBNZ) for near-term trade direction.

Not only the Federal Reserve (Fed) Chairman Jerome Powell’s refrain from entertaining immediate rate cut concerns and the US President Donald Trump’s push but the St Louis Federal Reserve Bank President James Bullard’s less dovish remarks also triggered short covering of the US Dollar (USD) during late-Tuesday.

However, sluggish prints of the US Consumer Confidence and New Home Sales data kept exerting downside pressure on the greenback.

While no policy change is expected to be offered at today’s RBNZ, growing support for easy monetary policy from the top-tier global central banks keep highlighting the market consensus of a dovish statement from the Kiwi central bank.

Should there be an increased fear of another rate cut during 2019, the New Zealand Dollar (NZD) might have to liquidate the majority of its latest gains. Though, the momentum will be on the mercy of the US catalysts during the later part of the day when Durable Goods Orders can offer additional insights.

Technical Analysis

Sustained break of June 11 high enables the Kiwi pair to aim for monthly top surrounding 0.6682 ahead of targeting 200-day simple moving average (SMA) level of 0.6711 whereas 50-day SMA level of 0.6587 and May 27 peak near 0.6560 can entertain sellers if prices decline below 0.6610

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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