NZD/USD bulls run into a wall of hourly resistance, focus is on the downside

• The focus is on central banks and the Covid-19 torment. 
• The price is running into hourly resistance below a bearish 10/21 EMA crossover.

NZD/USD is off by some 0.45% at the time of writing and is correcting the bearish hourly impulse within the day's range of 0.6801 to 0.6745 so far. A series of central bank meetings are scheduled for this week which is weighing on risk appetite and the higher beta currencies such as the kiwi.

Central banks on focus

With a shift from the transitory language, inflation risks are the driving force on a week where more than 20 central banks are expected to meet this week including the Federal Reserve, the European Central Bank, the Bank of England and the Bank of Japan.

Besides inflation, Omicron will be a top priority on these central bank's mandates at a time where the first publicly confirmed death globally was announced at the start of this week from the swiftly spreading strain. Case numbers have started to soar – particularly in Europe and risk-off flows are a weight for the kiwi despite the fact that Markets are positioning for multiple further rate rises by the RBNZ next year.

''Given the busy domestic and international event schedule, we’re keeping an open mind, especially given that the NZD and AUD “wore it” disproportionally last night,'' analysts at ANZ Bank said. 'Volatility seems to be the order of the day, with most traders likely watching correlated markets rather than data. Food price data today isn’t likely to perturb the Kiwi much.''

NZD/USD technical analysis

The price is running into hourly resistance below a bearish 10/21 EMA crossover. The pressures would be expected to move in from the bears around the 38.2% Fibonacci retracmenet level resulting in a downside continuation of the bearish trend.