NZDUSD: Profit taking into RBNZ decision

NZDUSD – technical overview

Overall pressure remains on the downside with the market continuing to stall out on runs up into the 0.6500 area. At the same time, there are some signs of the market wanting to put in a longer-term base. Ultimately, a break back above 0.6500 would be required to take the medium-term pressure off the downside and encourage this prospect. A monthly close below 0.5800 will intensify bearish price action.

• R2 0.6222 – 12 June high – Strong
  
• R1 0.6200 – Figure – Medium
  
• S1 0.6048 – 2 July low – Medium
  
• S2 0.6031 – 15 May low – Strong
  

NZDUSD – fundamental overview

There is no change expected from the RBNZ today, though we have seen profit taking into the event risk. We've also seen some Kiwi selling on the New Zealand Treasury's reporting of weaker sales, with consumers experiencing hardship. Absence of first tier data on Wednesday’s calendar will leave the focus on another round of Fed Chair testimony and some Fed speak.

Exclusive FX research from LMAX Group Market Strategist, Joel Kruger