NZD/USD Price Analysis: Prepares for a range expansion above 0.6250

• NZD/USD is in a sideways trend below 0.6250, upside seems favored as the USD Index has refreshed its annual low.
• The New Zealand Dollar would show action next week due to the release of the PBoC policy.
• NZD/USD is consolidating in a narrow range around the 61.8% Fibonacci retracement at 0.6233.

The NZD/USD pair is demonstrating a sideways auction below the immediate resistance of 0.6250 in the early New York session. The Kiwi asset is struggling to show a power-pack action amid an absence of economic indicators that could bring volatility.

S&P500 futures have added more gains as the risk appetite theme is in action. The US Dollar Index (DXY) has refreshed its monthly low at 102.01 as the Federal Reserve (Fed) might not stand with the promise of two more interest rate hikes this year.

US economic prospects are losing their resilience and the margin between desired inflation rate and current price pressures is effectively eroding. Also, tight credit conditions by the US regional banks to maintain their asset quality in the turbulent environment are doing their job efficiently.

The New Zealand Dollar would show action next week due to the release of the interest rate decision by the People’s Bank of China (PBoC).

NZD/USD is consolidating in a narrow range around the 61.8% Fibonacci retracement (plotted from May 11 high at 0.6385 to May 31 low at 0.5985) at 0.6233 on a two-hour scale. The Kiwi asset is in an inventory adjustment phase and a breakout is anticipated.

Upward-sloping 20-period Exponential Moving Average (EMA) at 0.6218 indicates that the short-term trend is bullish.

The Relative Strength Index (RSI) (14) is broadly oscillating in the bullish range, which indicated more upside ahead.

A confident break above May 17 high at 0.6261 will drive the Kiwi asset toward May 19 high at 0.6306 followed by May 08 high around 0.6360.

Alternatively, a downside move below the intraday low at 0.6015 will expose the asset for a fresh six-month low toward 11 November 2022 low at 0.5984. A slippage below the latter would expose the asset toward 02 November 2022 high at 0.5941.

NZD/USD four-hour chart