NZD/USD bulls failing to convince at key resistance
- NZD/USD bears eye a break of 0.6190 that could open significant risks to the downside.
- 0.6270 is key resistance on the daily chart.
NZD/USD is in a grind and making hard work of the upside near 0.6270s resistance. The pair moved up from 0.6195 and reached a high of 0.6253 on the day, climbing higher by some 0.9%. However, the price is failing to convince as it is contained by the horizontal resistance.
Risk appetite improved due to First Citizens BancShares’ agreement to buy all of the failed lender Silicon Valley Bank’s deposits and loans. US regulators said on Monday they would backstop a deal for regional lender First Citizens BancShares to acquire failed Silicon Valley Bank, triggering an estimated $20 billion hit to a government-run insurance fund. First Citizens shares jumped more than 53% during Monday trading on Wall Street.
´´The Kiwi recovered from yesterday’s sub-0.62 levels overnight as the USD came under pressure and commodity prices bounced. There was no real catalyst for overnight moves but markets continue to fiercely debate the outlook for Fed policy, and cuts priced in beyond May seem to be really weighing on the dollar,´´ analysts at ANZ Bank said.
´´Locally there’s very little in the calendar until next week’s MPR, so we’ll likely go with the ebb and flow of global sentiment as in recent weeks,´´ the analysts added. ´´As we noted yesterday, we continue to ask; will NZ’s remoteness to all this deliver NZD strength if the RBNZ can get the OCR to 5¼%? Will a hawkish tone (they’re hardly going to throw the towel in and be dovish) give the Kiwi a boost next week? It might.´´
NZD/USD technical analysis
NZD/USD has been sliding out of the dynamic trendline support in what has been a sideways grind for the best part of the month. Failures to hold 0.6190 could open significant risks to the downside while below 0.6270.