- The NZD/USD fell on Thursday, but recovered in the midday as the US Dollar takes a breather.
- USD eases pressure and gives the Kiwi a chance to recover Fed-led swoon.
- New Zealand and the US set for Friday PMIs to close out the trading week.
The NZD/USD got knocked lower following a hawkish Fed on Wednesday, tumbling 1.5% before the Kiwi (NZD) managed to find a floor near 0.5895.
The trading week will cap off action with Purchasing Manager Index (PMI) figures for both New Zealand and the US markets.
Fed holds rates, but sees holding longer rate cycle
The Federal Reserve (Fed) held benchmark interest rates at 5.5% on Wednesday, but the US central bank is forecasting that rates will remain higher for longer than previously anticipated. 2024's year-end interest rate is currently expected to be 5.1%, compared to the previously forecast 4.6%.
With the Fed hitting hawkish notes, the US Dollar (USD) climbed across the entire global currency market. Thursday saw the Greenback continue its march until the midday, where currency counterparts found some breathing room and eased back recent losses.
Friday markets will finish up the trading week with NZ and US PMIs, but NZ PMIs are unlikely to drive much market momentum. Most investors will be keeping their eyes turned to the US PMI release, where the manufacturing and services components are anticipated to tick upwards, albeit slightly.
The US Manufacturing PMI component is seen rising to 48.0 from 47.9, while the services sector is expected to rise from 50.5 to 50.6.
NZD/USD technical outlook
The Kiwi-Dollar pairing fell through the 200-hour Simple Moving Average (SMA) early Thursday, slipping to a near-term low of 0.5895. Hourly candles could see the NZD/USD slip back to the 200-hour SMA is bullish momentum falters or Dollar bulls return to the fold.
Daily candlesticks see the Kiwi trading into familiar five-week ranges after getting knocked back from the 34-day Exponential Moving Average (EMA) just above 0.5950.
A sustained bull move will see technical resistance from the 200-day Simple Moving Average (SMA) drifting below the 0.6200 handle, while further downside sees little in the way of support until 2022's late low far below current price action, near 0.5500.
NZD/USD hourly chart
NZD/USD 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. 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
GBP/USD hovers around 1.2750 on UK election day
GBP/USD extends its sideways grind near 1.2750 in the American session on Thursday. A broadly softer US Dollar keeps the pair afloat but traders refrain from placing fresh bets on the Pound Sterling while awaiting exit polls of UK election.
EUR/USD holds steady near 1.0800 after ECB Accounts
EUR/USD continues to fluctuate in a tight range near 1.0800 in the second half of the day on Thursday. The accounts of the ECB's June policy meeting fail to influence the Euro's valuation as trading conditions remain thin, with US markets remaining closed on Independence Day.
Gold trades with caution above $2,350, as focus shifts to US NFP
Gold struggles to build on Wednesday's gains and trades in a narrow band above $2,350. Sustained US Dollar weakness alongside sluggish US Treasury bond yields help XAU/USD limit its losses ahead of Friday's key June jobs report from the US.
Crypto Today: Bitcoin crumbles under German government transfers, Ethereum and Ripple erase gains
Bitcoin trades below $57,100 on Thursday as German government transfers continue, $76 million BTC moved to exchanges. Ethereum trades near $3,100 ahead of the upcoming SEC decision on the Spot Ethereum ETF.
Investors await NFP to validate their Fed rate cut bets
Investors expect two rate cuts, even though Fed signals one. Recent data corroborates investors’ take. Nonfarm Payrolls waited for more confirmation.