US dollar collapse as Fed fails to excite traders.
“Fed toning down on aggressiveness hinder further bets.”
Greenback relinquished, hovering near one-month low as latest meeting minutes from Federal Reserve failed to excite market bulls. On yesterday, the minutes confirmed recent comments from Atlanta Fed President Raphael Bostic who suggested a pause on rate hikes in September. Bostic emphasize that the exercise is necessary to monitor the effects of policy tightening on US economy. Evidently, recent revelation on Fed’s eventual plan on rate hike has diminished market bull’s commitment to place further bets on greenback. In return, market participants shifted their focus towards other risky assets.
Quick recap on NZDUSD
The pair remains traded within a descending wedge, albeit with short to mid-term potential for further upside.
NZDUSD Weekly Technical Analysis
In terms of weekly chart, the pair staged its rebound from lower level of the wedge, forming a possible retracement wave in the short to mid-term.
NZDUSD Daily Technical Analysis
From daily chart perspective, the pair looking to extend its recovery, with its nearest hurdle at around 0.6539.
Trading Idea
ORDER: BUY STOP
ENTRY: 0.6570
STOP LOSS: 0.6490
Target 1: 0.6655
Target 2: 0.6690
ZFX Analyst’s Comment
In lieu of recent developments, market sentiment towards the Fed continues to diminish following plans to pause future rate hikes. Likewise, other major central banks such as ECB who signaled for a possible lift in interest rate may provide further support towards other major currencies.
—
Risk Warning: The above content is for reference only, and does not represent ZFX’s position. ZFX does not assume any form of loss caused by any trading operations carried out in accordance with this article. Please be firm in your thinking and do the corresponding risk control.
ZFX (Zeal Capital Market) is an FCA & FSA licensed online Forex & CFD broker providing more than 100 products for Forex, commodities, stock indices, and share CFDs. Open a trading account with min. USD 50 deposit and download our MT4 trading platform now!