NZD/USD Drops as Odds of RBNZ Rate Cut Increase, What's Next?

"Since the 18th of July, NZDUSD has dropped for 6 consecutive days. This is due to the increased expectations of a rate cut by RBNZ in the upcoming meeting (14th of August). What should we expect as the NZDUSD is approaching the 0.58600 support zone?

1. Current Situation

Fundamental Analysis:
- Expectations of interest rate cuts in August by RBNZ are rising (near future expectation of weakening NZD).
- FOMC is expected to hold interest rates in August, but there is an expectation of 3 cuts soon (near future expectation of a stable USD).

Technical Analysis:
- NZDUSD is approaching the 0.58600 support zone, there might be a rebound as buyers enter the market and pause the drops.

2. Key Levels to be Aware Of

Support Zone:
- 0.57700 to 0.58000. If the price can hold above these figures, NZDUSD might have a chance to rebound. If the price breaks below the 0.57700 support zone, there will be a high chance that NZDUSD will continue a downtrend until it hits the next support at 0.55200.

Short-term Resistance:
- If the price rebounds, the nearest (short-term) resistance will be at 0.60500, followed by a stronger resistance at 0.62000.

3. Things to be Aware Of

RBNZ & FOMC Policy Announcements:
Any forthcoming statements or decisions from the RBNZ or FOMC will be crucial.

For RBNZ, a confirmed rate cut or dovish tone could push the pair lower, while a more neutral tone could support a recovery."