FX.co ★ NZD/USD

The New Zealand Dollar (NZD) moves sharply higher against its counterparts, apart from the Canadian Dollar (CAD), on Tuesday. Versus the US Dollar (USD), the antipodean rises by 0.22%, trading around 0.5627. Since the Reserve Bank of New Zealand (RBNZ) monetary policy release last week, when it left interest rates unchanged, the Kiwi dollar has been well supported around 0.5600. Strategists at Commerzbank believe the Reserve Bank of New Zealand's latest move is not a move toward easing but rather "more of a pause than a dovish pivot." They still see the policy bias as leaning toward tightening, and they "continue to expect two further hikes, in December and 1Q27, which should limit further NZD downside." Looking ahead, the market will watch the NZ Q3 Employment data set on Wednesday. The Labor Cost Index is expected to fall to 0.5% from 0.7% recorded in the second quarter of this year. The Unemployment Rate is expected to fall to 5.5% from the previous reading of 5.6%. On the US Dollar side, investors are preparing for the United States (US) Midterm elections. As of writing, the US Dollar Index (DXY), which measures the strength of the US Dollar against six major currencies, According to Brown Brothers Harriman's strategists, "U.S. midterm elections will take place on Tuesday," as "Democrats are widely expected to win the House of Representatives." Furthermore, they point out that "control of the Senate will be much closer, but the wave will favor the Democratic Party" since "Democrats need to have a net gain of four seats to secure a majority in the Senate" and the target "is within reach, as Republicans will be defending six of the seven toss-up seats." As noted by Brown Brothers Harriman, "bets markets favor a Democratic sweep," with Polymarket and Kalshi "pricing the odds around 70%." For that reason, BBH believes that "it points to a relatively muted initial reaction in the markets if Democrats sweep both chambers," while "Republican Senate hold will be the big surprise." On the intraday chart, NZD/USD is trading at 0.5614 and shows a short-term bearish bias, as it trades below the 20-period Exponential Moving Average (EMA) of 0.5651. The pair's inability to move above this short-term EMA suggests rallies may be limited. In contrast, the RSI of about 40 indicates recovering momentum. On the upside, resistance appears at the 20-period EMA of 0.5651, as only a breach above this level can reduce downward pressure on the pair. The available dataset shows no technical support levels. Traders will have to rely on swing lows in the broader chart for support.