The New Zealand Dollar is inching lower against the U.S. Dollar on Tuesday as caution reined in speculators ahead of the U.S. Federal Reserve’s monetary policy decisions on Wednesday.
The Kiwi Dollar has been a beneficiary of strong commodity prices and weakness in the U.S. Dollar, which on Tuesday was hemmed into a narrow range as traders avoided taking big positions before the Fed meeting, which begins on Tuesday.
At 11:32 GMT, the NZD/USD is trading .7228, down 0.0009 or -0.13%.
Later in the session, traders will get a chance to react to the latest data on U.S. home prices, consumer confidence and East Coast manufacturing.
Daily Swing Chart Technical Analysis
The main trend is up according to the daily swing chart. A trade through .7243 will signal a resumption of the uptrend. A move through .7270 will reaffirm the uptrend. The main trend will change to down on a trade through .7146.
The main range is .7465 to .6943. The NZD/USD is currently testing its retracement zone at .7204 to .7266. This zone is controlling the near-term direction of the Forex pair.
The short-term range is .6943 to .7243. If the main trend changes to down then its retracement zone at .7093 to .7058 will become the primary downside target.
The major support is the retracement zone at .7027 to .6924.
Daily Swing Chart Technical Forecast
The direction of the NZD/USD on Tuesday is likely to be determined by trader reaction to the 50% level at .7204.
A sustained move over .7204 will indicate the presence of buyers. The first upside target is yesterday’s high at .7243, followed by a Fibonacci level at .7266 and a main top at .7270.
Not only will a move through .7270 reaffirm the uptrend, but it could trigger an acceleration to the upside. The daily chart indicates there is plenty of room to the upside with the February 25 main top at .7465 the next likely upside target.
A sustained move under .7204 will signal the presence of sellers. The first downside target is a minor pivot at .7195, followed by a main bottom at .7146.
For a look at all of today’s economic events, check out our economic calendar.