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During Tuesday's Asian session, the NZD/USD pair approaches 0.6215-0.6220, or a three-week peak. This is the third consecutive day that the pair has advanced.

Expectations that the Federal Reserve (Fed) could be approaching the end of its rate-hiking cycle keep US Dollar (USD) bulls on the defensive, which provides support for the NZD/USD pair. Ahead of the Reserve Bank of New Zealand's (RBNZ) policy meeting and the publication of the crucial US CPI report on Wednesday, market participants appear reluctant to place aggressive bets.

The recent breakout through a confluence resistance comprised of the 100-day Simple Moving Average (SMA) and a descending trend-line suggests that the path of least resistance for the NZD/USD pair is higher. In addition, oscillators on the daily chart have just begun gathering positive momentum, validating the bullish setup and bolstering near-term upside potential.

Before placing fresh bullish wagers, it will be judicious to wait for some follow-through buying beyond the June monthly peak, around the 0.6245-0.6250 region, which corresponds to the 61.8% Fibonacci retracement level of the May-June decline. The NZD/USD pair could then accelerate its momentum towards probing the 0.6285 intermediate barrier before attempting to reclaim the 0.6300 round-figure level.

In contrast, the 0.6190-0.6185 confluence resistance breakpoint appears to now protect the immediate downside ahead of the 38.2% Fibo. level, which is located in the 0.6140-0.6135 region. Any subsequent decline may attract some purchasing and remain cushioned close to the 0.6100 level. This is closely followed by the 23.6% Fibonacci level around 0.6080, below which the NZD/USD pair could drop to the psychological 0.6000 level.

Some follow-through selling below the yearly low, near the 0.5985 region reached in June, should pave the way for a near-term decline.

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