NZD/USD Analysis 30/07: Cautious Reversal Downwards (Chart)

(MENAFN- Daily Forex) The NZD/USD has correlated with the broad Forex market and seen nervous selling filter into the currency pair, this as it has moved lower and is near the 0.59630 ratio. Financial institutions await the Fed later today.

Forex traders who have had bearish expectations of the USD may be struggling a bit early today, this as financial institutions clearly are exhibiting caution globally. The NZD/USD which only a handful of days ago was testing the 0.60600 vicinity has fallen lower again and is testing values seen on the 22nd of July, this before strong buying ensued. The U.S Federal Reserve will be making their FOMC decision public later today.

The U.S Fed is not anticipated to be aggressive via its pronouncements today. Jerome Powell, the Fed Chairman, is expected to continue preaching patience as a virtue. Financial institutions have likely braced for this type of sermon and are selling the NZD/USD. The lows being traded currently may begin to look attractive as places to consider buying the NZD/USD, but speculators with limited funds will need to be extremely careful.

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The broad Forex market has the Fed later today to think about, tariff considerations and its noise coming on Friday, and the U.S jobs numbers too as this week ends. Financial institutions cannot be blamed for being cautious and buying the USD short-term, but the coming hours and days are likely to produce more volatile results. Is a possible reversal higher likely?

It does look from a technical perspective the 0.59400 may be considered oversold territory for the NZD/USD. However, traders looking to step into a wager of the NZD/USD need to understand that price velocity will be seen. Looking for upside to develop as the Federal Reserve releases its interest rate policy and makes its feelings known is a dangerous wager. The NZD/USD moves fast and as tempting as it might be to look for reversals, the bet will not be for the emotionally weak.

EURUSD Chart by TradingViewWagering on the NZD/USD

Today's trading will become volatile in the coming hours as big players position themselves and react to technical and sentiment shifts in the NZD/USD. The currency pair was happily trading above the 0.60000 level from the 22nd until the 28th of July.

• Muscle memory of the recent higher values may create the desire to try and look for a reaction that drives the NZD/USD higher based on the notion that financial institutions have already sold the rumor.
• The rumor is that the Fed is anticipated to remain cautious.
• And the hope for those who want to wager on upside in the NZD/USD is that Jerome Powell will offer the hope of potential interest rates to come.
• It will be dangerous in Forex and the NZD/USD over the next couple of days, traders need to understand the risks and prepare accordingly.

NZD/USD Short Term Outlook:

Current Resistance: 0.59675

Current Support: 0.59590

High Target: 0.59920

Low Target: 0.59410

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