Tuesday, September 26, 2023
HomeBusinessNZD/USD stalls at 0.6400 after strong gains on dollar weakness

NZD/USD stalls at 0.6400 after strong gains on dollar weakness

  • NZD/USD moves up to 0.6400 and 0.6450s to watch.
  • 0.6450 is the confluence between the August high and the 61.8% retracement of the entire 2022 move point.

NZD/USD stalls below 0.6400, Currency markets have traded this week as the dollar attempts to correct an already sharply lower trend. At the time of writing, NZD/USD was down more than 1% and fell from a high of 105.896 to a low of 104.664. Dollar move was driven by dovish comments from Fed Chair Jerome Powell, or at least by comments from the Fed Chair The market prefers to listen. Fed Powell said in a speech on Wednesday that the central bank will ease the pace of its record rate hikes at its next policy meeting in December. Powell said in a speech at the Brookings Institution: “The time to slow down the pace of rate hikes will likely be at the December meeting. As soon as possible” agency. As a result, the dollar fell, U.S. yields fell, and stocks rose. The Standard & Poor’s 500 index ended its three-day losing streak, closed up 2.7%, and the Dow officially entered a bull market. However, Powell acknowledged that “the path ahead for inflation remains highly uncertain” when he said “by any measure, Inflation remains too high,” and “more time is needed” for evidence that inflation is actually falling, which could mean the Fed will keep raising rates until 2023. Also, earlier this week, St. Louis Fed President James Bullard warned that the stock market is undervaluing a persistently aggressive Fed. On Thursday, New York Fed’s John Williams said recently that he predicts the Fed will cut the federal funds rate “probably 2024,” saying on Fox News that the Fed has the means to keep raising rates. Still, the market is running on dovish comments on the speech, which is good for both hawks and doves and has been Seeing that NZD rebounded strongly through resistance at 0.6325 (76.4% Fibonacci of Aug-October sell-off) in the past 24 hours, the following technical analysis will show:

    NZD/USD Technical Analysis

The above series of charts, weekly, daily and H4 charts illustrate the prospects of entering the 0.6450s. Analysts at ANZ Bank believe that “price action looks very solid and technically the next major target level is 0.6450 (marking the August high and the 61.8% retracement of the entire 2022 move).”

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