The New Zealand Dollar (NZD) eased from session highs near 0.5800 against the US Dollar (USD) on Wednesday, as traders turned cautious ahead of the Federal Reserve’s monetary policy decision later today. Despite the pullback, the pair continues to hold above 0.5750, maintaining a mildly positive short-term trend.
Risk Sentiment Fades Ahead of Fed
The US Dollar trimmed earlier losses as risk appetite waned in the run-up to the Fed’s interest rate announcement. The shift in tone reflects broader investor caution, with markets positioning defensively before the Federal Open Market Committee (FOMC) releases its policy statement and rate outlook.
Adding to the uncertainty, recent comments from China’s Foreign Minister, who urged the U.S. to help stabilize global supply chains, failed to provide a meaningful boost to risk-sensitive assets such as the Kiwi Dollar.
Technical Analysis: 0.5805 and 0.5850 Key Resistance Levels
The NZD/USD pair remains in an upward channel from mid-October lows around 0.5680, but the latest rejection from 0.5795 highlights persistent resistance near the 0.5800 zone — a former support area turned cap.
- Upside levels:
A clear break above 0.5805 (October 9 high) would be needed to confirm renewed bullish momentum. Beyond that, the next significant resistance lies at 0.5850 (October 6 high). A move above this region would invalidate the broader bearish pattern of lower highs and lower lows and open the door toward 0.5915 (September 11 low). - Downside levels:
Immediate support lies at 0.5760 (Tuesday’s low) and then at 0.5750, aligned with the ascending trendline from the October 14 low. A sustained break below this zone could expose the pair to deeper losses toward 0.5710, the area defined by the October 17 and 21 lows.
Outlook: Bulls Face an Uphill Battle
While the NZD/USD retains a constructive short-term tone, the 0.5800–0.5850 resistance range remains a formidable barrier. A dovish Fed tone could offer limited upside potential for the pair, whereas a more hawkish policy message may reinforce USD demand and push the Kiwi back toward recent lows.
