GBP/NZD Plunges Ahead of RBNZ Interest Rate Decision

FXOpen

The pound fell broadly against the kiwi dollar on Wednesday taking the price to less than 2.0347 ahead of the RBNZ monetary policy decision which is scheduled for release today during the late US session. The short term bias however is bullish because of higher highs on the 4-hour frame.

Technical Analysis

As of this writing, the pair is being traded around 2.037. The bears look set to take control and drag the price lower to test the support around 2.027, the 38.2% fib level. Success in breaking this level could open the way to test the support around 2.019, the confluence of 50% Fib level and 200-day SMA ahead of 2.011 which is another confluence of 50-Day SMA and 61.8% fib level of the last leg from 1.9861 to 2.0539, as demonstrated in the following chart. The said level restricted the price on various occasions in the past.

gbpnzd

On the upside, a resistance can be noted around 2.0539, the high of December 9 and November 11. Success in breaking this level will make the pair test the potential growth targets that lies around 2.063 and 2.074. The bias will remain bullish as far as the support area around 1.9925 is intact.

RBNZ Interest Rate Decision

The Reserve Bank of New Zealand (RBNZ) is expected to keep the interest rate unchanged at 3.5% for current month as compared to the same cash rate in the month before. Investors will also be evaluating the RBNZ monetary policy statement very closely for the long term direction of the monetary policy.

Goods Trade Balance

 The UK’s Trade balance is expected to remain at GBP9.500 billion this October lower than GBP 9.821 billion in the month before, says the average forecast of different economists. Generally speaking, a higher trade deficit reading is considered bearish for pound and vice versa. Thus a worse than expected actual outcome may induce selling pressure in the price of GBP/NZD.

Trade Idea

In the light of overall technical outlook, selling the pair around the current levels could be a good strategy if the price leaves a bearish pin bar or bearish engulfing pattern on the four-hour timeframe.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Latest from Forex Analysis

SNB Unexpectedly Lowers Interest Rate from 1.50% to 1.25% GBP Awaits Bank of England Verdict: Volatility Ahead? Market Analysis: AUD/USD and NZD/USD Sight Steady Increase European Currencies Adjust to Support Levels: Is Growth Possible? NZD/USD Exchange Rate Falls from Nearly 5-Month High

Latest articles

Weekly Market Wrap With Gary Thomson: Nasdaq 100 Index, GBP, SNB Interest rate, Brent Crude Oil
Financial Market News

Weekly Market Wrap With Gary Thomson: Nasdaq 100 Index, GBP, SNB Interest rate, Brent Crude Oil

Get the latest scoop on the week's hottest headlines, all in one convenient video. Join Gary Thomson, the COO of FXOpen UK, as he breaks down the most significant news reports and shares his expert insights.

  • Nasdaq 100 Index Reaches
Analytical META Stock Predictions for 2024, 2025-2030, and Beyond
Trader’s Tools

Analytical META Stock Predictions for 2024, 2025-2030, and Beyond

Meta Platforms, Inc., formerly known as Facebook, is a leading technology company renowned for its social media and virtual reality innovations. This article provides a detailed analysis of Meta's stock performance, future analytical projections for 2024 to 2030, and the

Commodities

Natural Gas Price: Bullish Trend Weakens

Forecasts of a hotter summer, published during April and May, led to a sustained bullish trend in the natural gas market, as this commodity is heavily used for air conditioning.

Specifically:
→ The XNG/USD chart indicates that from 1st April

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.