• GBP/NZD rose on Tuesday as New Zealand dollar weakened ahead of RBNZ rate decision.
• Investors are pricing in a 25bps cut, which would drop the cash rate to 3% and complete a 250bps easing cycle.
• Swaps signal almost a 100% probability that the Reserve Bank of New Zealand will slash its official cash rate by 25bps to 3.00% on Wednesday, extending its easing cycle to 250bps.
•Investors are pricing in the possibility of another 25 bps cut to 2.75% by early next year, keeping focus on the central bank’s projected path for the Official Cash Rate.
• Technical are bullish, daily RSI is positive at 66, daily momentum studies 9 and 10 DMAs are trending up.
• Immediate resistance is located at 2.2904(23.6%fib), any close above will push the pair towards 2.2300(Higher BB)
• Support is seen at 2.2767(Daily low) and break below could take the pair towards 2.2704 (38.2%fib).
Recommendation: Good to buy around 2.2850 with stop loss of 2.2750 and target price of 2.2950
