NZDUSD has formed higher lows connected by a rising trend line on its hourly time frame, with price gearing up to test the support area after bouncing off the highs around .5750.

The 100 SMA is above the 200 SMA to suggest that the path of least resistance is to the upside or that support is more likely to hold than to break. The moving averages are also in line with the 50% Fib around .5675 to add to its strength as a floor, but the 61.8% Fib could be the line in the sand for a correction since it lines up with the rising trend line just above the .5650 minor psychological mark.

Stochastic is still on the move down to reflect the presence of selling pressure, but the oscillator is dipping close to the oversold region to signal exhaustion soon. Turning higher would suggest that buyers are ready to take over and allow the uptrend to gain traction.

RSI also has some room to slide before reaching the oversold area to reflect exhaustion among sellers, so the correction could keep going until that happens.

NZDUSD could take cues from the upcoming RBNZ interest rate decision, as the central bank is widely expected to cut the OCR by 50 basis points from 4.25% down to 3.75%. This announcement has been priced in for months already, as the central bank took a break from policy meetings since November last year.

Refraining from talking about future easing moves could spur a profit-taking rally for the Kiwi, as this could dampen the odds of aggressive interest rate cuts. After all, there have been some notable improvements in New Zealand’s data, particularly when it comes to the jobs market.

Meanwhile, the dollar could continue to take cues from overall market sentiment, including Trump’s upcoming joint interview with Elon Musk around the same time as the RBNZ press conference.