NZD/USD Pulls Back to Mid-0.5900s as USD Rebounds.
NZD/USD Pulls Back from Two-Week High, Drops to Mid-0.5900s as USD Rebounds
FUNDAMENTAL OVERVIEW:
NZD/USD faced rejection near its 50-day Simple Moving Average (SMA) on Thursday, retreating from the 0.6000 psychological mark—its highest level in over two weeks reached a day earlier. The pair slipped to a fresh daily low around 0.5950 in early European trade, ending a two-day winning streak.
A modest rebound in the US Dollar Index (DXY) from its two-week low applied pressure on the Kiwi, with the uptick likely driven by position adjustments ahead of the US Producer Price Index (PPI) release. While expectations for a September Fed rate cut—alongside increased bets for at least two cuts this year—could limit USD gains, broader market optimism may help cushion NZD losses.
Positive sentiment was supported by the extension of the US-China trade truce and an upcoming US-Russia summit aimed at ending the Ukraine conflict. Given these mixed drivers, traders may prefer to await stronger selling momentum before anticipating further intraday declines in the pair.
NZD/USD TECHNICAL ANALYSIS CHART:
Technical Overview:
NZD/USD is trading within an up channel.
NZD/USD is moving below 20&50 Moving Averages (SMA).
The Relative Strength Index (RSI) is in the Buying Zone, while the Stochastic oscillator suggests Neutral trend.
Immediate Resistance level: 0.5995
Immediate support level: 0.5925
HOW TO TRADE NZD/USD
After a sustained downtrend, NZD/USD reversed its course and broke above a significant resistance level. It has since surpassed an immediate resistance and is now retesting this level, which has turned into a support zone. If the price holds above this new support, NZD/USD is likely to continue its upward trend.