FxWirePro: NZD/USD spikes higher, hawkish RBNZ surprise boosts kiwi

NZD/USD chart - Trading View 

NZD/USD spikes higher, trades 1.08% higher on the day at 0.7016 at around 04:00 GMT.

Kiwi buoyed across the board after the Reserve Bank of New Zealand's policy meet portrayed a hawkish tilt.

The RBNZ held the Official Cash Rate unchanged at 0.25%, matching wide market expectations.

The central bank surprised with taper announcement. RBNZ said that it would "Halt additional asset purchases under the Large Scale Asset Purchase (LSAP) program by 23 July 2021.”

On the data front, New Zealand Visitor Arrivals for May jumped past 1,785.7% expected to 2,531.6% YoY. 

NZD/USD reversed losses, edging higher from 0.6917 (fresh lows since November 24th 2020).

Renewed concerns about COVID-19, with Australia’s Sydney extending lockdown for two more weeks, is likely to keep upside limited. 

Major trend in the pair has shifted bearish. 21-EMA caps upside at 0.7066. Breakout at 200-DMA required for bearish invalidation.

Resumption of downside eyes trendline support at 0.6915. Breach below will see test of 38.2% Fib at 0.6702.