NZD/USD Price Analysis: Posts fresh four-month high near 0.6220 after soft US Inflation report

Source Fxstreet
  • NZD/USD refreshes four-month high near 0.6220 as softer-than-expected US CPI report boosts Fed rate-cut bets for September.
  • Investors await the Fed’s policy decision.
  • The Kiwi asset sets to deliver an Inverted H&S breakout.

The NZD/USD pair shoots to a four-month high near 0.6220 in Wednesday’s New York session. The Kiwi asset strengthens as the soft United States (US) Consumer Price Index (CPI) report for May has boosted the Federal Reserve’s (Fed) rate-cut bets for the September meeting, which has improved the risk appetite of market participants significantly.

Meanwhile, market volatility is expected to remain high as investors brace for Fed’s monetary policy outcome in the late New York session. The Fed is expected to leave interest rates unchanged in the range of 5.25%-5.50%.

Investors will majorly focus on the Fed’s dot-plot, which indicates where policymakers see interest rates heading. Fed officials are expected to project fewer rate cuts than three anticipated in March as they lack confidence that inflation will sustaining return to the 2% target. However, soft inflation for May would improve their confidence that the disinflation process has resumed.

On the Kiwi front, firm expectations that the Reserve Bank of New Zealand (RBNZ) will keep interest rates at their current levels for the entire year has kept the New Zealand Dollar upbeat.

NZD/USD seems confident to deliver a breakout of the Inverted Head and Shoulder (H&S) chart pattern on a daily timeframe. A breakout move of the above-mentioned chart formation results in a bullish reversal. The 20-day Exponential Moving Average (EMA) near 0.6130 continues to remain a major cushion for the New Zealand Dollar bulls. Upward-sloping 50-DEMA near 0.6085 suggests that the overall trend is bullish.

The 14-period Relative Strength Index (RSI) jumps into the 60.00-80.00 range. Should the oscillator establish itself in this range, momentum would lean toward the upside.

More upside would appear if the asset stabilizes above the intraday high of 0.6220, which will expose the asset January 15 high near 0.6250, followed by January 12 high near 0.6280.

On the contrary, fresh downside would appear if the asset breaks below April 4 high around 0.6050 This would drag the asset towards the psychological support of 0.6000 and April 25 high at 0.5969.

NZD/USD daily chart

NZD/USD

Overview
Today last price 0.6214
Today Daily Change 0.0071
Today Daily Change % 1.16
Today daily open 0.6143
 
Trends
Daily SMA20 0.6136
Daily SMA50 0.6037
Daily SMA100 0.6068
Daily SMA200 0.6056
 
Levels
Previous Daily High 0.6151
Previous Daily Low 0.6117
Previous Weekly High 0.6216
Previous Weekly Low 0.6101
Previous Monthly High 0.6171
Previous Monthly Low 0.5875
Daily Fibonacci 38.2% 0.6138
Daily Fibonacci 61.8% 0.613
Daily Pivot Point S1 0.6123
Daily Pivot Point S2 0.6103
Daily Pivot Point S3 0.6089
Daily Pivot Point R1 0.6157
Daily Pivot Point R2 0.6171
Daily Pivot Point R3 0.6191

 

 

Disclaimer: For information purposes only. Past performance is not indicative of future results.
placeholder
October hike odds climb toward 60% as Goldman and BofA both flip — what Warsh's "dose of accommodation" really changedRate futures now price roughly 55% to 62% for a 25bp hike at the October 27-28 FOMC, up from about 30% before Chair Warsh's post-meeting framing that the Fed is merely "removing some accommodation." Goldman Sachs has added an October hike to its forecast and Bank of America now sees moves in both October and December. Here is the repricing, the language behind it, and the two data points that decide it.
Author  Irene Q.
Sep 23, Wed
Rate futures now price roughly 55% to 62% for a 25bp hike at the October 27-28 FOMC, up from about 30% before Chair Warsh's post-meeting framing that the Fed is merely "removing some accommodation." Goldman Sachs has added an October hike to its forecast and Bank of America now sees moves in both October and December. Here is the repricing, the language behind it, and the two data points that decide it.
placeholder
WTI slips below $90.50 as Trump signals no pre-election strike on IranWest Texas Intermediate (WTI) oil price declines after posting nearly 2.5% gains in the previous day, trading around $90.30 per barrel during Asian hours on Friday.
Author  FXStreet
Oct 09, Fri
West Texas Intermediate (WTI) oil price declines after posting nearly 2.5% gains in the previous day, trading around $90.30 per barrel during Asian hours on Friday.
placeholder
Hurricane Isaias has shut in a quarter of Gulf oil output — can WTI clear $92 before Thursday's EIA report?WTI trades at $90.80 after rebounding roughly 3% from Wednesday's $87.96 low as Hurricane Isaias — the Atlantic season's first — forces producers to shut in about 25% of US Gulf of Mexico output. Brent holds at $103.41. The first official read on the disruption arrives with the EIA weekly petroleum report on Thursday 15 October — here are the key levels and both scenarios.
Author  Irene Q.
Oct 09, Fri
WTI trades at $90.80 after rebounding roughly 3% from Wednesday's $87.96 low as Hurricane Isaias — the Atlantic season's first — forces producers to shut in about 25% of US Gulf of Mexico output. Brent holds at $103.41. The first official read on the disruption arrives with the EIA weekly petroleum report on Thursday 15 October — here are the key levels and both scenarios.
placeholder
US September CPI preview: inflation set to hit 3.7% — will the Fed hike in December?US September CPI lands Wednesday with headline inflation seen at 3.7% y/y and core at 0.2% m/m. December hike odds sit near 70% — here are the scenarios, the calendar and the key levels.
Author  Irene Q.
23 hours ago
US September CPI lands Wednesday with headline inflation seen at 3.7% y/y and core at 0.2% m/m. December hike odds sit near 70% — here are the scenarios, the calendar and the key levels.
placeholder
Gold posts first weekly gain in three weeks — can $4,200 hold through CPI?Spot gold closed at $4,194.645, up 1.47% — its first weekly gain in three weeks — and COMEX futures settled back above $4,200 at $4,220.30. Here are the drivers, the levels and the scenarios into Wednesday's CPI.
Author  Irene Q.
21 hours ago
Spot gold closed at $4,194.645, up 1.47% — its first weekly gain in three weeks — and COMEX futures settled back above $4,200 at $4,220.30. Here are the drivers, the levels and the scenarios into Wednesday's CPI.
goTop
quote