- NZD/USD recovers from 0.6250 as the US Dollar turns sideways ahead of FOMC minutes.
- The likelihood of an interest rate cut by the Fed in March 2024 has dropped slightly.
- NZD/USD manages to sustain inside the Rising Channel chart pattern.
The NZD/USD pair has rebounded after discovering buying support near 0.6250 on Wednesday. The Kiwi asset finds cushion as the US Dollar Index (DXY) is struggling for a direction ahead of the release of the Manufacturing PMI for December to be reported by the United States Institute of Supply Management (ISM) at 15:00 GMT and the Federal Open Market Committee (FOMC) minutes.
S&P500 futures remains subdued in the Asian session, portraying caution among market participants ahead of crucial US economic events. The USD Index consolidates around 102.20 after a sharp recovery as investors reconsider about risk sentiment.
Bets supporting an interest rate cut by 25 basis points (bps) by the Federal Reserve (Fed) in March 2024 have dropped. As per the CME Fedwatch tool, the likelihood of an interest rate cut in March has come down to 67% from 72% projected on Tuesday.
NZD/USD trades in a Rising Channel chart pattern on a four-hour scale in which each pullback is considered as a selling opportunity by the market participants. The Kiwi asset slips below the 50-period Exponential Moving Average (EMA), which indicates that the near-term upside bias has dampened for now. The broader appeal will remain bullish until the asset sustains in the upward-sloping channel.
The Relative Strength Index (RSI) (14) has slipped into the bearish range of 20.00-40.00. Fresh recovery would appear when the momentum oscillator will deliver a range shift move.
Investors should capitalize a mean-reversion move to near the lower portion of the aforementioned chart pattern, which is around 0.6235. This would result in a recovery move towards 13 December 2023 high at 0.6287, followed by January 2 high at 0.6335.
In an alternate scenario, a breakdown below December 18 low near 0.6200 would expose the asset to 12 December 2023 high at 0.6170 and 8 December 2023 low near 0.6100.
NZD/USD four-hour chart
-638398659413830379.png)
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
Gold gives away some gains, slips back to $2,980
Gold retraced from its earlier all-time highs above the key $3,000 mark on Friday, finding a footing around $2,980 per troy ounce. Profit-taking, rising US yields, and a shift to a risk-on environment seem to be putting the brakes on further gains for the metal.
EUR/USD remains firm and near the 1.0900 barrier
EUR/USD is finding its footing and trading comfortably in positive territory as the week wraps up, shaking off two consecutive daily pullbacks and setting its sights back on the pivotal 1.0900 mark—and beyond.
GBP/USD remains depressed, treads water in the low-1.2900s
GBP/USD is holding steady in consolidation territory after Friday’s opening bell on Wall Street, hovering in the low-1.2900 range. This resilience comes despite disappointing UK data and persistent selling pressure on the USD.
Crypto Today: BNB, OKB, BGB tokens rally as BTC, Shiba Inu and Chainlink lead market rebound
Cryptocurrencies sector rose by 0.13% in early European trading on Friday, adding $352 million in aggregate valuation. With BNB, OKB and BGB attracting demand amid intense market volatility, the exchange-based native tokens sector added $1.9 billion.
Week ahead – Central banks in focus amid trade war turmoil
Fed decides on policy amid recession fears. Yen traders lock gaze on BoJ for hike signals. SNB seen cutting interest rates by another 25bps. BoE to stand pat after February’s dovish cut.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.