20-day EMA: NZD/USD price forecast suggests further recovery towards this level

• 0.5640 in sight as NZD/USD extends recovery on hawkish RBNZ outlook.
• December rate rise expected from the RBNZ, according to Commerzback.
• Ahead of US mid-term elections, uncertainty supports a US Dollar rebound.

0.5640 is within reach as the New Zealand Dollar (NZD) extends its recovery against the US Dollar (USD) in Friday’s European session. The Kiwi pair began recovering after Wednesday’s turmoil, which followed the Reserve Bank of New Zealand’s (RBNZ) surprise decision to keep the Official Cash Rate (OCR) at 2.75%.

Against expectations of an increase to 3%, the RBNZ maintained its OCR at 2.75%. The central bank nevertheless described the hold as temporary. Citing upside inflation risks, it signalled that monetary tightening would continue.

RBNZ pause, not pivot: Commerzbank sees steadier NZ outlook

Rather than signalling the beginning of an easing cycle, the latest RBNZ decision represents “more of a pause than a dovish pivot,” according to Commerzbank analysts. Despite recent currency weakness, they suggest the projected policy trajectory “should limit further NZD downside”. They “continue to expect two further hikes, in December and 1Q27,”.

Caution before next week’s United States (US) mid-term elections is also drawing buyers to the US Dollar. Having recovered all its earlier losses, the US Dollar Index (DXY) is trading broadly unchanged near 101.84 at the time of writing. The index measures the Greenback against six major currencies.

US midterms: Divided government and policy deadlock risks

A likely split between the White House and Congress leaves the US “heading towards what is known as a ‘divided government’,” Commerzbank analysts say. Much of President Trump’s agenda could nevertheless proceed even if legislation slows. In areas central to him, “such as foreign and trade policy, he has in any case relied primarily on executive orders recently,” they note.

0.5637: NZD/USD Technical Outlook

At 0.5637 on the daily chart, NZD/USD remains below its 20-period Exponential Moving Average (EMA) of 0.5658, keeping the near-term outlook bearish. Failure to regain this short-term trend indicator suggests the broader decline continues to constrain rebounds. With the Relative Strength Index (RSI) below neutral at 43.4, recovery momentum appears modest.

The October 28 low of 0.5584 provides the key downside support. Above the current price, the 20-day EMA near 0.5658 marks initial resistance, where sellers are likely to defend the existing downtrend.

(The technical analysis of this story was written with the help of an AI tool. Know more.)