The NZD/USD pair has seen a bit of selling pressure on Tuesday.
NZD/USD
The New Zealand dollar initially tried to rally against the US dollar but has fallen pretty significantly, as we continue to see a lot of concerns around the world. This is a major driver of where things are going at this point in time, and the New Zealand dollar will remain an asset that is going to be somewhat sluggish.
Ultimately, this market is one that we continue to see a lot of questions asked about, with the Reserve Bank of New Zealand being a little bit more dovish than many others; this is the biggest point that is playing out in this pair.
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The market is hanging around the 200-day EMA, which is at the 0.5850 level. If we break down from here, the 0.58 level could be an area of significant support, and this is a bit of a floor.
This is a market that's basically in the middle of the range
To the upside, the 0.59 level is an area that previously has been resistance, but all things being equal, this is a market that's basically in the middle of the range.
With this, markets continue to see a lot of questions asked about where we go next, and I think that is going to be more or less driven by the idea of interest rates in America continuing to rise.
Remember that we have CPI numbers coming out on Friday and the interest rate decision on Wednesday. That could have a major influence on how the US dollar behaves.
The New Zealand dollar, on the other hand, is already a bit of a known quantity in the fact that the central bank in New Zealand sounds a little bit more dovish.
Ultimately, this is a market that is range-bound but is looking a little heavier these last few weeks. This continues to be a market that is on edge, so with this, the markets will continue to watch the Fed and the economic numbers coming out of the United States.
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