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NZD/USD upside limted below channel resistance

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 9, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    NZD/USD is currently stalling at the 0.68 handle, but has been a 4 cent recovery so far in 2016 and almost a full reversal of the opening downtrend for this year among the Chinese debacle, global uncertainties and subsequent malaise in the financial arena.

    Specifically for the bird today, the RBNZ policy decision is announced 3pm NY/7am Syd/9am NZ. The markets is not expecting action from the Central Bank and most see the OCR remaining at 2.5%.

    However, there is a chance that the RBNZ makes a 25bp cut and that is holding the reigns of the price even though the NZ economy is ticking over with inflation pressures that are still very subdued, thus a move back to the midpoint of the inflation target is dropping over the horizon at current policy settings at the Central Bank.

    NZD/USD levels

    We are back towards the post NFP's highs and are targeting a break through the late Sep- recent resistance of the wide channel between 0.6400 and 0.6897. The move to the upside comes after recently breaking out of the 0.6550-0.6750 range. The resistance here is strong and a fade back to the 4hr 20 sma at 0.6774 could trigger a reversal on failed attempts to break the upside of the range.
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