NZD/USD: chipping away at 0.6920 support before FOMC

Currently, NZD/USD is trading at 0.6922, up 0.04% on the day, having posted a daily high at 0.6924 and low at 0.6918.

Forex today: stocks off a cliff ahead of FOMC

NZD/USD is slightly offered following the recent data. The New Zealand NZ Balance of Payments Current Account for Q4 arrived in NZD terms as -2.335bn vrs the expected  -2.425bn. Meanwhile, the focus remains on the US with the FOMC decision released tonight in the US session where markets fully expect a 25bp rate hike as a series of at least three for 2017. The key will be in the detail of the statement and the presser in Yellen's rhetoric and markets will be looking for any forward guidance. 

"Specifically, if the median of the distribution of the dots moves up significantly, markets would consider this as a hawkish message (“a hawkish hike”)," explained analysts at Nomura, however adding, "On the other hand, if the median of the dots stays the same as in the previous meeting (“a dovish hike”), the market impact of the release of updated projections should be limited."

NZD/USD levels

NZD/USD has been chipping away at the 0.6920 support. A break to the downside targets 0.6860 as a tough support area. To the upside, the 0.6950 area is the initial resistance area on a continuation of correction of the 0.72 handle's supply, (0.6950 is the7th March low). A follow though of there opens the door to 6th March high at 0.7045 and 1st March low 0.7098. There is a double bottom of potential resistance at 0.7130 on the 4hr chart in mid-Feb and late Fed business. For a tougher area of resistance we have 0.7245 as the late Jan/early Feb support and double top resistance Feb 16th and 23rd.