NZD/USD Bulls Fail to Break Key Resistance

• NZD/USD bears are eyeing a break of 0.6190 which could open up significant downside risks.
• 0.6270 is the key resistance on the daily chart.

The pair NZD/USD is in a sticky spot and is working hard to the upside near the 0.6270 resistance. The pair rose from 0.6195 and hit a high of 0.6253 on the day, up 0.9%. However, the price is contained by horizontal resistance.

Risk appetite improved due to agreement by First Citizens BancShares to buy all deposits and loans from failing Silicon Valley Bank. US regulators said Monday they would back a deal for regional lender First Citizens BancShares to acquire the failing Silicon Valley Bank, dealing an estimated $20 billion hit to a government-run insurance fund. First Citizens shares rose more than 53% in trading Monday on Wall Street.

Overnight, the kiwi rallied from yesterday’s sub-0.62 levels as the dollar came under pressure and commodity prices rallied. There was no real catalyst for the moves overnight, but markets are still hotly debating the outlook for Fed policy, and expected cuts beyond May appear to be really weighing on the dollar,” ANZ analysts noted. Bank.

Locally there is very little on the calendar until next week’s MPR, so it is likely that we will go with the ebb and flow of global sentiment as in recent weeks,” the analysts added. “As we noted yesterday, we continue to wonder : Will New Zealand’s remoteness to all this give strength to the NZD if the RBNZ can push the OCR to 5¼%? Will an aggressive line tone (they will hardly throw in the towel and be moderate) propel the Kiwi next week? Maybe yes”.

NZD/USD Technical Analysis

The NZD/USD pair has broken away from the dynamic trend line support in what has been a sideways move for most of the month. If it fails to hold at 0.6190, it could run significant downside risks below 0.6270.