NZD/USD Remains Rangebound, Holds Below 20-day EMA

The Kiwi traded sideways on Monday, with the NZD/USD pair fluctuating in a narrow range between 0.6105 and 0.6140 as investors await fresh cues from the Federal Reserve's interest rate decisions. The pair is currently consolidating amidst growing uncertainty over when the Fed will start reducing interest rates, with some market participants anticipating rate cuts in September and further moves in November or December.

• The NZD/USD remains range-bound between 0.6105 and 0.6150 over the past week or so, reflecting indecisiveness as investors seek clarity on future Fed policy. The pair is trading below the 20-day EMA at 0.6130, while the 14-period RSI oscillates between 50.00 and 60.00.
• Key levels to watch: Immediate support is around 0.6100 (Round number/ 50-day EMA), with additional support at 0.6050 (April 4 high) and 0.6000 (psychological level/June 14 low). On the upside, resistance is seen at 0.6222 (June 12 high), with further resistance at 0.6250 and 0.6280 (January highs).
• The US-NZ 2yr swap is 2bps lower at -32bps
• Market sentiment: Speculative net positions for the NZD have surged to 20.3K, up from 11.0K, indicating growing investor confidence. Despite this, the Employment Confidence Index fell to 91.4 in Q2, suggesting a pessimistic view of the labor market.
• US Dollar impact: The BBDXY dropped 0.29% to 1,264.37, influenced by lower US yields driven by robust preliminary S&P Global PMI data showing expansion in manufacturing and service sectors.
• Upcoming data: Calendar is empty today and Wednesday