NZDUSD Technical Analysis – The bearish trend is still intact

<p>US:</p><ul><li>The Fed <a href="https://www.forexlive.com/centralbank/federal-reserve-interest-rate-decision-25-bps-rate-hike-to-525-550-20230726/">hiked by 25 bps</a> as
expected and kept everything unchanged at the last meeting.</li><li>Fed Chair Powell reaffirmed their data dependency
and kept all the options on the table.</li><li>The <a href="https://www.forexlive.com/news/us-august-cpi-06-mm-versus-06-mm-expected-20230913/">US CPI</a> this
week came in line with expectations, so the market’s pricing remained roughly
the same. </li><li>The <a href="https://www.forexlive.com/news/us-august-non-farm-payrolls-187k-vs-170k-expected-20230901/">labour market</a>
displayed signs of softening although it remains fairly solid.</li><li>Last week the <a href="https://www.forexlive.com/news/us-august-ism-services-545-vs-525-expected-20230906/">ISM Services PMI</a> and <a href="https://www.forexlive.com/news/us-weekly-initial-jobless-claims-216k-vs-234k-expected-20230907/">Jobless Claims</a>
surprised to the upside, which point to a resilient economy overall. </li><li>Yesterday, we got yet another beat in <a href="https://www.forexlive.com/news/us-initial-jobless-claims-220k-versus-225k-estimate-20230914/">Jobless Claims</a> followed
by strong <a href="https://www.forexlive.com/news/us-august-retail-sales-06-versus-02-expected-20230914/">Retail Sales</a> and <a href="https://www.forexlive.com/news/us-august-ppi-16-yy-vs-12-expected-20230914/">PPI</a> data. </li><li>The Fed members are leaning more towards a pause in
September and the next decision will still be dictated by the economic data. </li><li>The market doesn’t expect the Fed to hike at the
September meeting and there’s just a 33% chance of a hike in November, although
that can change if the data keeps on running hot. </li></ul><p>New Zealand:</p><ul><li>The <a href="https://www.forexlive.com/centralbank/reserve-bank-of-new-zealand-leave-cash-rate-unchanged-at-55-as-widely-expected-20230816/">RBNZ</a> kept its official cash rate unchanged at the
last meeting while stating that it will remain at the restrictive level for the
foreseeable future to ensure that inflation comes down back to target. </li><li>The recent <a href="https://www.forexlive.com/news/new-zealand-q2-cpi-11-qq-vs-expected-10-20230718/">New Zealand inflation</a> and <a href="https://www.forexlive.com/news/new-zealand-unemployment-rate-36-vs-expected-35-20230801/">employment</a> data surprised to the upside but
the PMIs are in contraction with the <a href="https://www.forexlive.com/news/new-zealand-services-pmi-for-july-plunges-into-contraction-to-478-prior-501-20230813/">Services PMI</a> recently plunging into contraction.
</li><li>The wage growth has also missed
expectations and it’s something that the central banks are watching closely for
second round effects. </li><li>The New Zealand <a href="https://www.forexlive.com/news/new-zealand-q2-retail-sales-10-qq-expected-26-20230822/">Retail Sales</a> beat expectations although the data
remains deeply negative.</li><li>Today, the <a href="https://www.forexlive.com/news/new-zealand-manufacturing-pmi-for-august-461-prior-463-20230914/">Manufacturing PMI</a> showed further contraction. </li><li>The RBNZ is expected to keep the
cash rate steady at the next meeting.</li></ul><p>NZDUSD Technical Analysis –
Daily Timeframe</p><p>On the daily chart, we can see that NZDUSD has been
<a href="https://www.forexlive.com/Education/technical-analysis-understanding-divergence-20220429/">diverging</a> with the
<a href="https://www.forexlive.com/Education/technical-analysis-understanding-macd-20220427/">MACD</a> since
the breakout and this is generally a sign of weakening momentum often followed
by pullbacks or reversals. In this case, we are seeing a pullback with the
sellers leaning on the red 21 <a href="https://www.forexlive.com/Education/technical-analysis-understanding-moving-averages-20220425/">moving average</a> to
position for another selloff. If the price breaks above the moving average, we
can expect the sellers to pile in around the 0.5987 <a href="https://www.forexlive.com/Education/technical-analysis-support-and-resistance-20220405/">resistance</a> which
would give them an even better risk to reward setup. </p><p>NZDUSD Technical Analysis –
4 hour Timeframe</p><p>On the 4 hour chart, we can see that the price
action has been choppy but the pair is trading between key levels with an
upward tilt given that the price has been printing higher highs and higher lows
with the moving averages being crossed to the upside. A break above the 0.5930
resistance should lead to a rally into the 0.5987 resistance, while a break
below the 0.5892 support should result in a fall into new lows. </p><p>NZDUSD Technical Analysis –
1 hour Timeframe</p><p>On the 1 hour chart, we can see more
closely the short term price action between the key levels. We now have a range
between the 0.5930 resistance and the 0.5892 support. A break to the upside is
bullish, while a break to the downside is bearish. </p><p>Upcoming Events</p><p><a href="https://www.forexlive.com/EconomicCalendar">Today</a> the only notable
report left to be released for this week is the University of Michigan Consumer
sentiment survey. Consumer sentiment might have deteriorated given higher
energy prices and that might have filtered to higher inflation expectations. </p>

This article was written by FL Contributors at www.forexlive.com.