Fundamental
Overview
Yesterday, the US Consumer Confidence report surprised to the downside
with one of the largest drops since 2021. The labour market data in the report
softened a lot and it generally leads the unemployment rate.
The market responded by
raising the probabilities for the Fed to cut by 50 bps in November to roughly
60%. The question now is whether this is just about the low hiring rate or
something worse. We will have to wait for the NFP report next Friday.
On the NZD side, the market
is pricing a 56% chance of a 50 bps cut at the upcoming meeting and 90 bps of
easing by year-end.
NZDUSD
Technical Analysis – Daily Timeframe
NZDUSD Daily
On the daily chart, we can
see that NZDUSD almost reached the 0.6370 high as the US Dollar continues to
remain under pressure. If the price gets there, we can expect the sellers to
step in with a defined risk above the level to position for a drop back into the
0.6217 level. The buyers, on the other hand, will want to see the price
breaking higher to increase the bullish bets into new highs.
NZDUSD Technical
Analysis – 4 hour Timeframe
NZDUSD 4 hour
On the 4 hour chart, we can
see that we have an upward trendline defining the current bullish
momentum. If we get a pullback, the buyers will likely lean on it to position
for new highs, while the sellers will look for a break lower to increase the
bearish bets into new lows.
NZDUSD Technical
Analysis – 1 hour Timeframe
NZDUSD 1 hour
On the 1 hour chart, we can
see that we have another minor trendline defining the bullish momentum of this
timeframe. Again, the buyers will likely lean on the trendline to position for the
continuation of the uptrend, while the sellers will look for a break lower to
pile in for a drop into the major trendline. The red lines define the average daily range for today.
Upcoming
Catalysts
Tomorrow, we get the latest US Jobless Claims figures, while on Friday, we
conclude the week with the US PCE.