NZD/USD PRICE OUTLOOK: KIWI-DOLLAR EYES RBNZ RATE DECISION IN WAKE OF POWELL TESTIMONY

  • The DXY Index notched a modest acquire on Tuesday regardless of the US Greenback buying and selling broadly combined
  • Fed Chair Powell prompted an inflow of US Greenback weak spot throughout his congressional testimony
  • NZD/USD worth volatility is about to speed up with the RBNZ announcement on deck for launch
  • Sharpen your technical evaluation expertise or find out about implied volatility buying and selling methods!

The US Greenback traded broadly combined throughout Tuesday’s session. US Greenback weak spot was seen primarily in opposition to its Pound Sterling and Canadian Greenback friends, however this was offset by notable beneficial properties throughout USD/CHF and USD/JPY. On steadiness, the DXY Index eked out a 0.1% acquire as US Greenback bulls look to defend a important technical assist zone across the 90.00-price degree.

DXY – US DOLLAR INDEX PRICE CHART: DAILY TIME FRAME (25 NOV 2020 TO 23 FEB 2021)

DXY Index Price Chart US Dollar Technical Forecast

Chart by @RichDvorakFX created utilizing TradingView

This potential space of buoyancy highlights the neckline of an obvious head-and-shoulders sample. Failing to take care of the 90.00-handle may see the early January swing low come again into focus, which is roughly underpinned by the decrease Bollinger Band. Reclaiming the 50-day easy transferring common may encourage US Greenback bulls to eye the 17 February excessive as the following resistance degree. That stated, with Fed Chair Powell eager conserving market circumstances extremely accommodative as communicated throughout his congressional testimony earlier at present, it appears doubtless that the US Greenback will proceed going through bearish headwinds.

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USD PRICE OUTLOOK – US DOLLAR IMPLIED VOLATILITY TRADING RANGES (OVERNIGHT)

USD Price Chart Outlook US Dollar Implied Volatility Trading Ranges NZDUSD USDCHF

NZD/USD worth motion is predicted to be probably the most energetic out of the majors on Wednesday. That is judging by its in a single day implied volatility studying of 15.1%, which is above its 20-day common of 9.9% and ranks within the prime 80th percentile of measurements taken over the past 12-months. Upcoming occasion danger posed by the RBNZ announcement scheduled for launch Wednesday, 24 February at 01:00 GMT doubtless explains the sharp uptick in NZD/USD implied volatility. The Reserve Financial institution of New Zealand is broadly anticipated to depart financial coverage unchanged, however ahead steerage offered by RBNZ Governor Orr may weigh materially on the Kiwi and gas volatility through the press convention.

Maintain Studying – New Zealand Greenback Outlook: NZD/USD Eyeing 2018 Highs, Will RBNZ Disappoint?

— Written by Wealthy Dvorak, Analyst for DailyFX.com

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