NZDUSD @ 0.64350 – Support/Resistance analysis: aims to recapture two-month high at 0.6260 on upbeat Business NZ PMI

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NZDUSD @ 0.64350 – Support/Resistance analysis: aims to recapture two-month high at 0.6260 on upbeat Business NZ PMI

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• NZD/USD is advancing towards its two-month high at 0.6260 as Business NZ PMI lands higher at 52.7.
• A fourth consecutive 50 bps rate hike is expected by the RBNZ.
• The impact of the lower US CPI print is fading away and investors are focusing on Fed’s next meeting.

The pair currently trades last at 0.64350.

The previous day high was 0.6436 while the previous day low was 0.6275. The daily 38.2% Fib levels comes at 0.6374, expected to provide support. Similarly, the daily 61.8% fib level is at 0.6336, expected to provide support.

The NZD/USD pair has continued its four-day winning streak and is likely to recapture its two-month high at 0.6260 as Business NZ has reported upbeat PMI data. The economic data has landed at 52.7, higher than the expectations of 52.5 and the prior release of 50.

An upbeat PMI data has strengthened the kiwi bulls against the greenback. Also, it may back the former to print a fresh two-month high.

Going forward, the kiwi bulls are likely to dance to the tunes of the Reserve Bank of New Zealand (RBNZ) as the central bank will announce an interest rate decision on Wednesday.

As per the Reuters poll, the RBNZ will elevate its Official Cash Rate (OCR) by 50 basis points (bps) consecutively for the fourth time, taking the interest rates to 3%. Also, the insights from Reuters’ survey indicate that the RBNZ will elevate its OCR to 4.00% by mid-2023. And, the Inflation is expected to fall within the target range of 2-3% in the H1CY2023.

Meanwhile, the US dollar index (DXY) is likely to display a minor correction after facing hurdles around 105.20. The upside seems intact as investors have ignored the evidence of exhausting inflation and are now focusing on the extent of the rate hike that the Federal Reserve (Fed) will feature in its monetary policy meeting in September.

There is no denying the fact that inflation exhaustion signals cheered the market participants. However, price pressures are still on the rooftop and highly deviated from the desired levels. So Fed’s rate announcement will continue further.

Technical Levels: Supports and Resistances

NZDUSD currently trading at 0.6432 at the time of writing. Pair opened at 0.6403 and is trading with a change of 0.45 % .

The pair is trading above its 20 Daily moving average @ 0.6254, above its 50 Daily moving average @ 0.6276 , below its 100 Daily moving average @ 0.6453 and below its 200 Daily moving average @ 0.6629

The previous day high was 0.6436 while the previous day low was 0.6275. The daily 38.2% Fib levels comes at 0.6374, expected to provide support. Similarly, the daily 61.8% fib level is at 0.6336, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 0.6307, 0.6211, 0.6146
• Pivot resistance is noted at 0.6467, 0.6532, 0.6628

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