NZDUSD, USDJPY, EURUSD

RBNZ decision --> NZDUSD

The RBNZ is expected to cut rates by 50 bps on Wednesday. Formerly recognized for its aggressive stance during the global tightening cycle, it executed a significant policy reversal over the summer by initiating a loosening campaign before the Fed's commencement of its own. Policymakers are fully pricing  in a rate cut, given that the annual CPI rate is within the 1-3% target range, inflation expectations are stabilizing at approximately 2.0%, and GDP growth is persistently tepid.

NZDUSD is continuing to exhibit the selling interest that started back at the end of September, recording a fresh 13-month low of 0.5815. Steeper decreases may drive the market toward the October 2023 bottom at 0.5770. In the case of an upside move, the pair may rest near the 0.5920 resistance level, which overlaps with the 20-day simple moving average (SMA). The technical oscillators continue to trend downward.

US Core PCE inflation --> USDJPY

The US PCE inflation report is scheduled to be released on Wednesday as well. Powell recently stated that he anticipates a slight increase in the core PCE index from 2.7% to 2.8% in October, which would constitute a setback for the Federal Reserve. According to the forecast, the headline PCE will increase from 2.1% to 2.3%. Investors will also look at the minutes of November’s policy meeting for any clues about the next interest rate decision.

On Friday, traders will have a break due to the Thanksgiving holiday.

USDJPY is holding in an upside structure after the rebound from the 139.56 trough, and it is still holding well above the short-term uptrend line and the 200-day SMA.  In the preceding days, the price posted a new three-and-a-half-month high of 156.75 but is currently below the 155.00 psychological mark. A move above the previous peak could send traders to the 158.85 resistance. In the negative scenario, the 200-day SMA at 151.90 would act as a major support.

Eurozone flash CPI --> EURUSD

Friday's Eurozone preliminary CPI data will be in the spotlight. In October, the headline CPI increased from 1.7% to 2.0%. An additional rise to 2.4% is anticipated for November, which may extinguish prospects for a more substantial reduction, potentially aiding the euro in halting its recent sharp decline.

EURUSD recorded its third consecutive red week, losing more than 5% and experiencing a fresh two-year low of 1.0330 during Friday’s session. Currently, the pair is recouping some of its losses and approaching the 1.0500 round number. A successful closing session above this area may open the door to a visit to the 1.0600 mark. On the other hand, more downside pressures may take the market towards the latest trough of 1.0330 and the November 2022 low at 1.0220. The momentum oscillators currently show mixed signs.