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Technical analysis – NZDUSD stuck in range ahead of Fed meeting



NZDUSD lost ground after peaking at the 2023 high of 0.6536 in early February. Nevertheless, the pair managed to halt its retreat and has been moving sideways within a rectangle pattern for more than a month now.

The momentum indicators currently suggest that near-term risks are tilted to the downside. Specifically, the stochastic oscillator has posted a bearish cross, while the RSI failed to reclaim its 50-neutral mark after breaking below it for the first time in the past seven days.

Should bearish pressures intensify, the price could initially test 0.6144, which is the 38.2% Fibonacci retracement of the 0.5510-0.6536 upleg. If that barricade fails, the 2023 low of 0.6083 might act as the next line of defense. Failing to stop there, the pair could face the 50.0% Fibo of 0.6023.

Alternatively, should buyers re-emerge and push the price higher, immediate resistance could be met at the 23.6% Fibo of 0.6296, which overlaps with the 50-day simple moving average (SMA). Escaping the rangebound pattern, the pair might ascend towards the February resistance of 0.6388. A violation of that territory could set the stage for the 2023 high of 0.6536.

Overall, NZDUSD seems to be in a consolidation phase, waiting for developments that could provide fresh directional impetus. Therefore, a break above or below this sideways pattern is likely to be followed by a significant move in the same direction.


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