- NZD/USD: rests up at a crucial resistance area while traders run out of a catalyst to push higher.
- NZD/USD: now above the 200-month moving average resistance at 0.6994.
NZD/USD has been in consolidation along the trendline support at 0.7030 and around the 50-hr SMA at 0.7032, taking a breather within the 29th May rally where the bulls have run into the 3rd May resistance and 29th April prior support area.
NZD/USD has been sidelined since yesterday’s trade as traders run out of ammo while geopolitical matters remain up in the air with no clear direction. There is a void of domestic data and instead markets keep an eye on US events and indeed, will be looking to the FOMC meeting next week.
Federal Reserve to hike by 25bps
“At this point, it would be extremely surprising were the Committee to forego a rate hike,” analysts at Nomura argued, adding, “Economic data have indicated accelerating activity over the intermeeting period, with an unemployment rate at 3.8% and inflation approaching the Committee’s 2% objective. Policymakers have continued to signal another rate increase, despite some financial market turbulence related to events abroad and trade policy at home.”
Meanwhile, analysts at ANZ explained that the kiwi finds itself pretty much at the same level where it was this time yesterday:
“It is sidelined right now as the focus is elsewhere and markets look through the ‘will they or won’t they’ flip-flopping that has become the global trade war spat. We don’t see the sidelined behaviour changing much today.”
Key levels
NZD/USD Technical Analysis: Kiwi bulls faced with 0.7050 barrier, trapped in wedge formation
Key support is located at 0.6880 while resistance is located at 0.7030. NZD/USD is trading above the 200-month moving average resistance at 0.6994 and weekly technicals have turned bullish. Support comes in from the 50-hr SMA. 0.7440 comes as key upside target as the January tops. Below 0.6850/80, 0.6780 comes as next downside target meeting the lows of mid-Nov 2017.
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