The NZDUSD currency pair remains above 0.5900 despite the rate cut by the People’s Bank of China and the release of New Zealand’s Trade Balance data.

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• NZD/USD oscillates above 0.5900 despite PBoC’s rate cut and NZ’s Trade Balance data.

The pair currently trades last at 0.59241.

The previous day high was 0.5948 while the previous day low was 0.5908. The daily 38.2% Fib levels comes at 0.5923, expected to provide support. Similarly, the daily 61.8% fib level is at 0.5933, expected to provide resistance.

The NZD/USD pair trades in a narrow range above the round-level support of 0.5900 in the London session. The Kiwi asset fails to find direction despite the People’s Bank of China (PBoC) cutting its one-year benchmark rate to uplift economic prospects amid a highly uncertain demand. The PBoC lowered its one-year Prime Lending Rate (PLR) by 10 basis points (bps) to 3.40% than 15bps as expected.

S&P500 futures add significant gains in Europe, portraying a revival in the risk appetite of the market participants. Overnight US futures attracted significant bids as investors hope that interest rates in the United States economy are peaked for now. The US Dollar Index (DXY) drops to near 103.15 after facing stiff barriers near 103.50 as investors see no more interest-rate hikes this year.

A Reuters poll conducted between August 14 and 18 showed that the Federal Reserve (Fed) will keep interest rates steady in September and will not cut rates before March next year. Meanwhile, the odds of a recession have dropped to 40%, the lowest in a year. It seems that the central bank will allow more time for current interest rates to tackle stubborn inflation.

This week, investors will keenly focus on the Jackson Hole Economic Symposium, which will start on Thursday. Fed chair Jerome Powell is expected to provide an outlook on inflation and interest rates.

Meanwhile, the New Zealand Dollar remains less volatile despite the release of July’s trade balance data. Imports were higher than the former reading while exports remained weak, which indicates that domestic demand is upbeat while exports take a hit due to weak China demand.

This week, NZ Q2 Retail Sales data will be keenly watched, which will be published on Wednesday. In the last quarter, consumer spending contracted, demonstrating the consequences of higher interest rates.

Technical Levels: Supports and Resistances

NZDUSD currently trading at 0.5926 at the time of writing. Pair opened at 0.5922 and is trading with a change of 0.07 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 0.6076, 50 SMA 0.615, 100 SMA @ 0.6169 and 200 SMA @ 0.6232.

The previous day high was 0.5948 while the previous day low was 0.5908. The daily 38.2% Fib levels comes at 0.5923, expected to provide support. Similarly, the daily 61.8% fib level is at 0.5933, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 0.5904, 0.5886, 0.5864
• Pivot resistance is noted at 0.5944, 0.5966, 0.5984

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