FxWirePro: NZD/USD holds steady ahead of RBNZ decision

• NZD/USD  traded in tight range on Tuesday as investors stayed cautious ahead of the Reserve Bank of New Zealand’s policy decision.

• The Reserve Bank of New Zealand is widely expected to lower its Official Cash Rate by 25 basis points to 3.00% at Wednesday’s policy meeting.

• The anticipated move comes as inflation remains contained and labor market conditions continue to weaken, giving the central bank room to ease policy further in support of economic growth.

•  Interest rate swaps indicate nearly a 100% probability that the Reserve Bank of New Zealand will lower its Official Cash Rate by 25 basis points to 3.00% at Wednesday’s policy meeting.

• Investor attention will center on the RBNZ’s updated projections for the Official Cash Rate to gauge how much further the easing cycle could extend.

•  Immediate resistance is located at 0.5948(SMA20), any close above will push the pair towards 0.6014 (38.2%fib).

•  Support is seen at 0.5915 (50%fib)and break below could take the pair towards 0.5869(Lower BB).

 Recommendation: Good to sell around 0.5940 with stop loss of 0.6000 and target price of 0.5860