By ForexTime
NZDUSD surged after the Reserve Bank of New Zealand (RBNZ) left its Official Cash Rate unchanged at 5.5%, as widely expected.
More importantly for Kiwi bulls (those hoping that NZDUSD would go higher) …
the RBNZ said that its policy needs to be “restrictive for a sustained period”.
And as we know, markets tend to reward the currency of the economy whose interest rates can stay higher for longer.
Free Reports:
Following the RBNZ decision, NZDUSD a.k.a the “kiwi” saw a price movement range of over 300 points rallying to a high of 0.60774.
This psychological 0.60700 level will be closely monitored ahead of today’s US CPI release!
The US consumer price index (CPI) measures the rate of inflation, that is, the changes in the prices of a basket of goods and services over a period, in the United States.
The incoming data is expected to show:
More FX volatility could be expected after the US CPI announcement.
The FOMC’s March meeting minutes are due to be released at 6:00 pm GMT today (Wednesday, April 10th).
NZDUSD has rallied for over 1300 points from its year-to-date low at 0.59391.
A surprisingly soft US CPI, with the year-on-year figures close to 3%, may turbocharge the “kiwi” upwards by a further 700 points!
This could send NZDUSD to an upper trendline resistance around 0.61382!
Possible near-term resistance:
The Fibonacci retracement levels are taken from the December 13th low at 0.60839 to the December 28th high at 0.63692.
On hotter-than-expected US CPI data, the US dollar may strengthen, which sets Kiwi up for a decline.
Possible near-term support can be seen at
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