- NZD/USD grinds lower around intraday low following PBOC rate cut.
- PBOC cuts 1-year LPR to 3.80%, keeps 5-year rate unchanged.
- Failures to cross 21-DMA, downbeat oscillators favor sellers.
NZD/USD remains pressured inside a 15-pip trading range around 0.6730 during early Monday. In doing so, the Kiwi pair justifies a surprise rate-cut announcement from New Zealand’s key customer China.
The PBOC announced a five basis points (bps) of a cut to the benchmark one-year Loan Prime Rate (LPR) top 3.80% while keeping the five-year rate intact around 4.65%.
Technically, the pair’s failure to cross the 21-DMA hurdle during the last week’s corrective pullback joins downbeat MACD and RSI conditions to weigh on the quote.
That said, the NZD/USD prices decline towards the retest of a descending support line from March, around 0.6700.
However, oversold RSI conditions hint at a bounce from the stated support line, a break of which will open doors for a downward trajectory towards the late 2020 bottom near 0.6590.
On the contrary, a clear upside break of 21-DMA level of 0.6820 will need validation from September’s low close to 0.6860 before recalling the NZD/USD bulls.
In a case where the pair remains firmer past 0.6860, odds of its run-up to early October swing high near 0.6985 can’t be ruled out.
NZD/USD: Daily chart
Trend: Further downside expected
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
EUR/USD breaks below 1.1000 on stellar NFP
The buying bias in the Greenback gathers extra pace on Friday after the US economy created far more jobs than initially estimated in September, dragging EUR/USD to the area of new lows near 1.0950.
GBP/USD breaches 1.3100 after encouraging US Payrolls
The continuation of the uptrend in the US Dollar motivates GBP/USD to accelerates its losses and breaches 1.3100 the figure in the wake of the release of US NFP.
Gold rebounds from daily lows and flirts with $2,670
Following a post-NFP dip to the $2,640 region, Gold prices now embarks on an acceptable rebound and retest the area of $2,670 per ounce troy despite the marked advance in the US Dollar and rising US yields across the board.
US Payrolls surge in September, as 50bp rate cut ruled out
US payrolls data surprised on the upside in September, rising by 254k, smashing expectations of a 150k rise. The unemployment rate fell to 4.1% from 4.2%, average hourly earnings increased to a 4% YoY rate and there was a 72k upwards revision to the previous two months’ payrolls numbers.
RBA widely expected to keep key interest rate unchanged amid persisting price pressures
The Reserve Bank of Australia is likely to continue bucking the trend adopted by major central banks of the dovish policy pivot, opting to maintain the policy for the seventh consecutive meeting on Tuesday.
Five best Forex brokers in 2024
VERIFIED Choosing the best Forex broker in 2024 requires careful consideration of certain essential factors. With the wide array of options available, it is crucial to find a broker that aligns with your trading style, experience level, and financial goals.