NZD/USD Slides Further Ahead of the Fed and RBNZ

NZD/USD Slides Further Ahead of the Fed and RBNZ

27 April 2016, 14:33
Roberto Jacobs
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NZD/USD Slides Further Ahead of the Fed and RBNZ

Expectations that RBNZ might discuss prospects of a rate-cut during its monetary policy meeting on Thursday dragged the NZD/USD pair lower below 0.6850 level.

Although the Fed, due to announce its monetary policy decision later during the day, is expected to hold its key interest rates unchanged, it could still provide some hint towards the timing of next rate-hike decision. The expectations of diverging monetary policy actions between the Fed and RBNZ is likely continue exerting pressure on the NZD/USD pair in the near-term.

Technical levels to watch

The pair has just managed to hold a short-term ascending trend-line support near 0.6835 area, which if broken seems to open room for an immediate slide towards 0.6800 round figure mark. The downfall could further get extended towards its next major support near 0.6765-60 area, nearing 38.2% Fibonacci retracement level of 0.6347-0.7054 up-swing.

Meanwhile, a bounce-back from the ascending trend-line support and a subsequent strength above 0.6870 intermediate minor resistance seems to assist the pair towards reclaiming 0.6900 round figure mark. A sustained strength above 0.6900 mark handle has the potential to continue boosting the pair towards 0.6965-70 strong horizontal resistance.


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