NZD/USD Price Analysis: Kiwi pulls back ahead of RBNZ decision

NZD/USD declines to 0.5700 on Tuesday after hitting its highest level since late January last week.
Bulls remain in control as long as the pair holds above the 20-day SMA, with the RBNZ decision set to drive the next move.

Patricio Martín FXStreet

The New Zealand dollar faced selling pressure on Tuesday, dropping 0.58% agains the US Dollar to 0.5700 after last week’s rally saw the pair climb to its highest levels since late January above 0.5730. Despite the pullback, the broader outlook remains positive, with the 100-day Simple Moving Average (SMA) at 0.5825 still in focus.

Looking ahead, market participants are gearing up for the Reserve Bank of New Zealand’s (RBNZ) policy decision during the Asian session. The central bank’s guidance will likely dictate the pair’s next major move, with a hawkish tone potentially reigniting the upside momentum, while a dovish stance could extend the ongoing pullback.

In the meantime,technical indicators point to a natural correction rather than a shift in trend. The Relative Strength Index (RSI) declined sharply to 56 but remains in positive territory, suggesting that buyers are still in control. Meanwhile, the Moving Average Convergence Divergence (MACD) histogram prints rising green bars, indicating that bullish momentum has not been completely exhausted. A break below the 20-day SMA, however, could tilt the balance in favor of the bears.

NZD/USD daily chart

Author

Patricio Martín

FXStreet

Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.

EUR/USD stays weak near 1.1850 after dismal German ZEW data

EUR/USD remains in the red near 1.1850 in the European session on Tuesday. A broad US Dollar bullish consolidation combined with a softer risk tone keep the pair undermined alongside downbeat German ZEW sentiment readings for February.

GBP/USD holds losees near 1.3600 after weak UK jobs report

GBP/USD is holding moderate losses near the 1.3600 level in Tuesday's European trading. The United Kingdom employment data suggested worsening labor market conditions, bolstering bets for a BoE interest rate cut next month. This narrative keeps the Pound Sterling under bearish pressure.

Gold pares intraday losses; keeps the red above $4,900 amid receding safe-haven demand

Gold (XAU/USD) attracts some follow-through selling for the second straight day and dives to over a one-week low, around the $4,858 area, heading into the European session on Tuesday.

Canada CPI expected to show sticky inflation in January, still above BoC’s target

Economists see the headline CPI rising by 2.4% in a year to January, still above the BoC’s target and matching December’s increase. On a monthly basis, prices are expected to rise by 0.1%.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Stellar mixed sentiment caps recovery

Stellar price remains under pressure, trading at $0.170 on Tuesday after failing to close above the key resistance on Sunday. The derivatives metric supports the bearish sentiment, with XLM’s short bets rising among traders and funding rates turning negative.