On the daily chart below for NZDUSD, we can see that as the price spiked to the 0.6389 resistance after the RBNZ hiked by more than expected, the sellers entered the market aggressively as the US data started to show material weakness and the market began to get recessionary vibes.

The price then fell for hundreds of pips, eventually going back into the previous range between the 0.6191 support and 0.6270 resistance. The price is now bouncing from the support as the US CPI yesterday didn’t offer much in terms of clarity with headline CPI falling more than expected and Core CPI Core CPI Core Consumer Price Index (CPI) is a measure of inflation that excludes certain volatile items, and that's almost always food and energy prices. The idea behind using core CPI is that these items can have large fluctuations in prices due to factors such as weather, natural disasters and geopolitical tensions, which do not necessarily reflect underlying inflationary trends. By excluding these items, the core CPI provides a more stable and reliable measure of underlying inflation.The specific item Core Consumer Price Index (CPI) is a measure of inflation that excludes certain volatile items, and that's almost always food and energy prices. The idea behind using core CPI is that these items can have large fluctuations in prices due to factors such as weather, natural disasters and geopolitical tensions, which do not necessarily reflect underlying inflationary trends. By excluding these items, the core CPI provides a more stable and reliable measure of underlying inflation.The specific item Read this Term coming in more or less within expectations.

Today the market will be focused on the US Jobless Claims as they recently started to show weakness, and if it turns into a trend, the market may start to fear the recession.

NZDUSD technical analysis

On the 4 hour chart below, we can see that the big channel the market was trading in has been broken. If we look at it from a big picture perspective, it can be interpreted as a bearish flag, which is a continuation pattern.

This may suggest that we could see much more weakness in the pair going forward with a break below the 0.6084 low looking good. The red long period moving average is acting as resistance at the moment and if we get a higher than expected number in Jobless Claims, we may see the price falling again breaking below the 0.6191 support.

On the 1 hour chart below, we can see that the market is trading within a mini range. The setup looks pretty clear: break above the resistance and the buyers will be in control, on the other hand, break below the support and the sellers will push the price to lower lows. This consolidation at the support may go on until the Jobless Claims report.