#NZDUSD @ 0.62482 has moved higher to 0.6250 after a recovery move as USD Index has retreated. (Pivot Orderbook analysis)

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• NZD/USD has moved higher to 0.6250 after a recovery move as USD Index has retreated.
• Tight credit conditions for US businesses and households after the SVB collapse might cool down the overall demand.
• The Fed sees no rate cuts in 2023 as restrictive monetary policy is required to bring down inflation to 2%.

The pair currently trades last at 0.62482.

The previous day high was 0.6283 while the previous day low was 0.6171. The daily 38.2% Fib levels comes at 0.624, expected to provide support. Similarly, the daily 61.8% fib level is at 0.6214, expected to provide support.

The NZD/USD pair has extended its recovery move to near 0.6250 in the Asian session. The Kiwi asset rebounded firmly from 0.6220 as the US Dollar Index (DXY) showed a short-lived pullback move after dropping to near 102.00. The USD Index is hovering near its six-month low and is expected to continue its downside momentum as the Federal Reserve (Fed) has approached to its terminal rate.

A 25 basis point (bp) rate hike by the Fed was widely anticipated, which pushed rates to 4.75-5.00%. Fed chair Jerome Powell tried harder to maintain his hawkish stance citing that rate cuts in 2023 are not into consideration as restrictive monetary policy is highly required to bring down the inflation rate to 2%. The stage of hawkish stance got de-railed after Fed Powell commented “some additional policy firming may be appropriate”, which indicated that the Fed has come closer to pausing the rate-hiking spell.

United States equities went through a massive sell-off on Wednesday as Fed Powell stemmed fears of a dismal economic outlook due to lower demand and the scale of economic activities. Cues from Fed Powell’s commentary indicate that the US banking system is ‘sound and resilient’ but tight credit conditions for households and businesses cannot be ruled out.

Coming to Asia-Pacific, the New Zealand Dollar is struggling to maintain its feet as the street is anticipating a lower growth rate in the kiwi zone after the flood situation.

Meanwhile, Reserve Bank of New Zealand (RBNZ) Chief Economist Paul Conway on Thursday said interest rates were clearly contracting and causing a welcome slowdown in demand in the economy, though it was not yet clear that inflation expectations were under control, as Reuters reported.

Technical Levels: Supports and Resistances

NZDUSD currently trading at 0.6248 at the time of writing. Pair opened at 0.6221 and is trading with a change of 0.43 % .

The pair is trading above its 20 Daily moving average @ 0.6194, below its 50 Daily moving average @ 0.6304 , below its 100 Daily moving average @ 0.6275 and above its 200 Daily moving average @ 0.6162

The previous day high was 0.6283 while the previous day low was 0.6171. The daily 38.2% Fib levels comes at 0.624, expected to provide support. Similarly, the daily 61.8% fib level is at 0.6214, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 0.6167, 0.6113, 0.6055
• Pivot resistance is noted at 0.6279, 0.6337, 0.6391

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