Tests 50% of the week’s trading range
The NZDUSD tumbled yesterday early in the session after the RBNZ cut rates by a surprising 50 bps (was expecting 25 basis points). The price moved to a low of 0.63768.
However, the fall actually increased the chances for the Fed to follow up with their own cut at the next meeting. The chances are now 100% for a cut in September. The chances of a 50 bps cut is 25%. That led to lower yields, a lower USD and the NZDUSD moved higher.
Technically, the pair is currently testing of the 50% retracement of the week’s trading range at 0.64814. Just above that, comes swing lows from June and early August at 0.64865 to 0.64899. As I type we just moved up to the 0.6490 level. Sellers leaned on the first test and the price has moved lower.