We and the market participants expect the RBNZ to keep the OCR at 1.5% in today’s meeting, due at 2 pm. The cross NZDUSD gained 30 pips to close at 0.6640 and managed to sustain above the previous day’s high, indicating a positive bias to continue towards the critical resistance level 0.6680.
According to the daily candlesticks chart, the critical support level is placed around 0.6600. If the cross starts moving upward, key resistance levels to watch out are 0.6660 and 0.6680 early June high. Above here focus shifts to its 200MA located at 0.6700.
A weekly close above 0.6700/0.6720 could push the cross further higher towards 0.6900 and 0.6960 levels.
The broader forex traders are anticipating that the RBNZ keeps OCR on hold before a further cut in Q3 and Q4 in 2019.
NAB and Westpac economists expect the RBNZ to cut 25bps in August.
- NAB reported that “BNZ thinks the Bank is likely to sound sufficiently dovish to leave the market largely pricing another 25bp cut at the August Monetary Policy Statement.”
- Westpac “We expect the RBNZ to cut the OCR to 1.25% at the August MPS”.
Key support and resistance for AUDNZD
AUDNZD closed below 1.05 overnight. According to the candlestick chart, the cross lost all the key moving averages at all time frames. The cross may fall to 1.0450-1.0420 zone, as suggested by the A-B-C corrective wave pattern. The 61.8 fib reaction finds at 1.0450.
It is important to always keep in mind the risks involved in trading with leveraged instruments.
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