NZD/USD trimmed Thursday's gains, stumbles below 0.6400
|- NZD/USD finished the week with solid gains of 0.6700%, spurred by softer US CPI data.
- Consumer inflation expectations in the US edged lower and weighed on the US Dollar.
- NZD/USD Technical Analysis: Failure at 0.6400, cheered by sellers, eyeing a fall to 0.6300.
The NZD/USD retraced after testing the current week’s high of 0.6417, dropped beneath the 0.6400 mark, as the pair consolidated in the 0.6300-0.6420 range during the last week’s. Positive US consumer sentiment readings proved to be harmful to the American Dollar (USD), which will end the week on a lower note. At the time of writing, the NZD/USD spot price is 0.6389, slightly down by 0.03%.
NZD/USD trimmed its daily gains, despite a risk-on impulse
Wall Street held to its gains as the week came to an end. The release of US inflation data on Thursday was cheered by investors and spurred hopes for slower rate hikes by the US Federal Reserve (Fed), weakening the US Dollar (USD). The CME FedWatchTool shows that the Fed’s probabilities for a 25 bps rate hike lie at 94.2%, which would lift the Federal Funds rate(FFR) to the 4.50% - 4.75% range.
The University of Michigan (UoM) Consumer Sentiment survey showed that sentiment improved, exceeding expectations of 60.5, coming at 64.6. Meanwhile, Americans’ inflation expectations for one year were revised to 4% from 4.4% in December, while for a five-year horizon, inflation is estimated to reach 3% from 2.9% in the previous month.
Elsewhere, the US Dollar Index (DXY), which measures the buck’s performance against a basket of six rivals, erases its earlier gains, down 0.06%, at 102.184.
NZD/USD Technical Analysis
Therefore, the NZD/USD shifted downwards though it remained supported by the 20-day Exponential Moving Average (EMA) around0.6329. Nevertheless, failure at 0.6400 exposed the NZD/USD to further selling pressure, with bears eyeing a break below the 20-day EMA ahead of testing the 0.6300 mark.
On the flip side, if the NZD/USD reclaims 0.6400, that could set the pair poised to test December 2022 high at 0.6513.
NZD/USD Key Technical Levels
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.