NZDUSD Technical Analysis – Key levels in play

US:

• The Fed hiked by 25 bps as
  expected and kept everything unchanged at the last meeting.
• Fed Chair Powell reaffirmed their data dependency
  and kept all the options on the table.
• Inflation measures
  since then showed further disinflation.
• The labour market
  displayed signs of softening although it remains fairly solid.
• Overall, the economic data started to surprise to
  the downside lately.
• This week the ISM Services PMI and Jobless Claims
  surprised to the upside.
• The Fed members are leaning more towards a pause in
  September rather than another rate hike.
• The market doesn’t expect the Fed to hike at the
  September meeting, but there’s now a 50/50 chance of a hike in November.

New Zealand:

• The RBNZ kept its official cash rate unchanged at the
  last meeting while stating that it will remain at the restrictive level for the
  foreseeable future to ensure that inflation comes down back to target.
• The recent New Zealand inflation and employment data surprised to the upside but
  the PMIs are in contraction with the Services PMI recently plunging into contraction.
• The wage growth has also missed
  expectations and it’s something that the central banks are watching closely for
  second round effects.
• The New Zealand Retail Sales beat expectations although remains
  deeply negative.
• The RBNZ is expected to keep the
  cash rate steady at the next meeting.

NZDUSD Technical Analysis –
Daily Timeframe

On the daily chart, we can see that the bearish
momentum in the NZDUSD pair seems to be waning as the pair started to chop
around below the 0.5987 level. The bearish bias though remains intact as the
price has not yet broken the most recent lower high around the 0.60 handle and
the moving averages are
crossed to the downside.

NZDUSD Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see that we continue to
have a massive divergence with the
MACD which is
generally a sign of weakening momentum often followed by pullbacks or
reversals. In this case, the target should be the 0.6117 level, but the price
should first take out the 0.60 handle before rallying all the way up to the
0.6117 level.

NZDUSD Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that we
recently took out the resistance around
the 0.5895 level. We might see the buyers piling in here with a defined risk
below the level to target the 0.5930 resistance first, and eventually the 0.60
handle. The sellers, on the other hand, will want to see the price falling back
below the 0.5895 level to invalidate the bullish setup and position for another
fall into the lows targeting a break lower.