Forex Trading Tools and Services

Currencies NZD/USD

NZD/USD Forecast: Kiwi Poised to Extend Rally Toward 0.6100 on Weak US Data, Bullish Momentum

  • BY
  • June 5, 2025
  • 0 Comments

NZD/USD currency pair rallied to a seven-month high at around 0.6055, on the back of widespread strength in the New Zealand Dollar and weakness in the US Dollar despite persisting US-China trade tensions on weak US economic data. The Kiwi remained upbeat despite sustained US-China trade tensions, drawing strength from declining US Treasury yields and dovish Federal Reserve expectations. Technically, the pair is close to a bullish breakout through the consolidation range, with leaders such as the 20-day EMA and RSI hinting at upward momentum. A sustained break above 0.6050 might pave the way for a rally towards 0.6100 and further. KEY LOOKOUTS •  A break above this level might initiate bullish momentum towards 0.6100 and 0.6145. •  Any additional softness in US data can boost bets on a Fed rate cut, putting pressure on the US Dollar. •  Escalating tensions might affect risk sentiment and indirectly burden the NZD given New Zealand’s trade relationships with China. •  The bullish flag pattern, increasing 20-day EMA, and RSI above 60.00 all indicate further potential to go higher. NZD/USD pair maintains its rally, hitting a new seven-month high of around 0.6055 as the New Zealand Dollar trounces peers. The strength holds despite persistent US-China trade tensions, demonstrating the Kiwi’s resilience in a world filled with uncertainty. Subpar US economic data, such as weak ADP employment and ISM services data, has weighed on US Treasury yields and stoked hopes for a possible Fed rate reduction, further eroding the US Dollar. Technically, the couple is set to report a bullish break out of its latest consolidation range with momentum indicators such as the RSI and 20-day EMA favoring the move higher. A clean break above 0.6050 could set the stage towards the 0.6100–0.6145 resistance area. NZD/USD reaches a seven-month peak at around 0.6055 due to US Dollar weakness and healthy Kiwi demand. Bullish technical indications point towards a near-term breakout towards 0.6100. Weak US data and expectations of Fed rate cuts continue to pressure the Greenback. • NZD/USD reaches a seven-month peak at around 0.6055, propelled by general Kiwi strength. • Weak US economic indicators (ADP jobs, ISM Services) pressure US Treasury yields and the USD. • Speculation of Fed rate cut weighs on the US Dollar Index around 98.60. • US-China trade tensions continue, but the NZD stays resilient to potential threats. • Breakout expected technically, as NZD/USD nears the upper end of a bullish flag pattern. • RSI rises above 60, and the 20-day EMA steepens, indicating bullish momentum. • Next resistance levels are 0.6100 and 0.6145, while major support is at 0.5846. The NZD/USD pair has gained strong traction, reaching a seven-month high as the New Zealand Dollar outperforms amid a backdrop of global uncertainty. Despite ongoing tensions in US-China trade relations, the Kiwi has shown resilience, supported by investor confidence in New Zealand’s economic stability. Statements from the previous US President Donald Trump on how hard it is to get a trade deal done with China have raised geopolitical concerns without suppressing demand for the NZD. This level of strength is particularly surprising considering New Zealand’s close economic relationship with China, and it shows the market’s faith in the Kiwi currency. NZD/USD DAILY PRICE CHART CHART SOURCE: TradingView At the same time, the US Dollar is under pressure from soft local economic data. The most recent ADP Employment Change and ISM Services PMI for May missed expectations, which raised doubts regarding the health of the US labor market and service sector. These reports have resulted in lower US Treasury yields and heightened speculation regarding monetary policy easing by the Federal Reserve in future meetings. In turn, investors are turning away from the USD, and this provides additional support to NZD/USD appreciation in the larger market environment. TECHNICAL ANALYSIS NZD/USD is showing robust bullish momentum as it nears the upper limit of a Bullish Flag pattern, traditionally a continuation signal that foretells additional upside. The pair has moved out of its range of consolidation between 0.5846 and 0.6024, and this points to the possibility of an extended rally. The 20-day Exponential Moving Average (EMA) is pointing higher at 0.5925, supporting the upward trend. Furthermore, the 14-day Relative Strength Index (RSI) has moved past the 60.00 threshold, indicating building buying pressure. In the event that the pair remains above the level of 0.6050, it may reach the next significant resistance points of 0.6100 and 0.6145. FORECAST NZD/USD can see further upside if it continues above the 0.6050 level. A breakout above this level, supported by good technicals and weak US Dollar sentiment, could see the pair towards the next hurdle of 0.6100, then 0.6145. Ongoing weak US economic news, dovish Federal Reserve expectations, and calm risk appetite would also see the pair see the bullish path through. Conversely, if NZD/USD cannot maintain a level above the 0.6050 region and comes under renewed pressure from external risk factors—like rising US-China trade tensions or higher-than-expected US data release—the pair may retreat. A fall below the May 12 low of 0.5846 would leave it vulnerable to further downside towards the 0.5800 psychological level, with further support at the April 10 high of 0.5767.

Read More
Currencies

USD/CAD Falls Below 1.4100 Pre-US CPI Data Due to Weak Dollar and Pressure in Oil Market

  • BY
  • April 10, 2025
  • 0 Comments

The USD/CAD currency pair remains trading lower, falling below the 1.4100 level as the US Dollar continues to be under pressure prior to the eagerly awaited US Consumer Price Index (CPI) data for March. Anticipation of a modest dip in both headline and core inflation has cooled USD demand, with markets rethinking the chances of an imminent Fed rate cut. The Canadian Dollar also has its own headwinds as weakening oil prices—brought about by rising US-China trade tensions and renewed concerns about demand—bear down on the commodity-sensitive currency. Despite weakness in the USD, these countervailing forces are expected to cap the pair’s downside. KEY LOOKOUTS •  A softer-than-anticipated inflation figure may spur rumors of future Fed rate reductions, which could be a further drag on the US Dollar. •  As a significant Canadian export, falling crude prices due to worldwide demand worries and US-China trade tensions might cap CAD advances. •  Reaction to last week’s FOMC Meeting Minutes will continue to be pivotal, particularly about balancing inflation taming and economic slowdown. •  Any intensification of trade tensions might trigger risk-off sentiment, impacting oil prices and general currency market flows. The USD/CAD pair is down pressure below the 1.4100 level as investors wait for the US CPI inflation reading, which has the potential to influence expectations of upcoming Federal Reserve policy action. A lower inflation print would likely raise speculation on rate cuts, weakening the US Dollar further. But the Canadian Dollar is also coming under headwinds with declining oil prices amidst renewed concerns about demand triggered by rising US-China trade tensions. These counterforces—USD weakness against CAD vulnerability on sliding crude—are poised to create a tug-of-war in the pair’s direction, sustaining volatility in the near term. USD/CAD trades below 1.4100 as investors await key US CPI data, with expectations of a slight cooldown in inflation. While the US Dollar remains subdued, falling oil prices amid US-China trade tensions weigh on the Canadian Dollar, limiting further downside. • USD/CAD trades below 1.4100 for the second consecutive day amid US Dollar weakness. • March US CPI data are due, with inflation projected to slow to 2.6% from 2.8% in February. • Core CPI is predicted at 3%, down slightly from the last 3.1% reading. • FOMC minutes reveal concern over increasing inflation and decelerating growth, implying dovish Fed policy. • Market pricing indicates a 40% probability of a Fed rate cut next meeting, representing uncertainty. • WTI crude oil is close to $60.20, weighed down by demand concerns driven by US-China trade tensions. • Canadian Dollar is still susceptible to declining oil prices, topping gains against weakening USD. The USD/CAD currency pair is in the limelight as the market waits for the release of the US Consumer Price Index (CPI) data for March. This report is viewed closely because it gives information about inflation patterns within the United States, which greatly influence Federal Reserve actions. Mild cooling of inflation relative to the last month will be expected and may shape investors’ sentiments of future monetary policy actions. Concurrently, the latest Federal Open Market Committee (FOMC) minutes indicate that policymakers are closely walking a tightrope between inflation fears and risks of a decelerating economic growth. USD/CAD DAILY PRICE CHART CHART SOURCE: TradingView In addition, external pressures like global trade tensions are fueling market uncertainty. Fresh tensions between the US and China have renewed concerns about global demand, especially in the energy markets. Since oil is a crucial component of the Canadian economy, these events are being closely watched. The movement of crude oil prices and their reaction to overall economic signals will remain a key consideration for the Canadian Dollar. With both the US and Canadian economies having unique issues, market players are watchful in anticipation of any major economic releases. TECHNICAL ANALYSIS USD/CAD continues to exhibit signs of weakness as it continues below the psychological level of 1.4100. The currency pair has dipped below short-term support levels, reflecting a bearish near-term bias. Momentum indicators like the Relative Strength Index (RSI) indicate poor upside potential since they are resting close to neutral levels, and moving averages are beginning to tilt downwards, enhancing selling pressure. Should the pair be unable to hold its ground at or above 1.4100, however, it would begin to weaken to the next level of support around 1.4050, while a solid break higher at 1.4100 could set up the retesting of 1.4150 resistance. FORECAST In the event the US CPI for tomorrow surprises higher on the back of more solid-than-expected inflation, then the US Dollar will be pushed upwards by reinforcing the Fed’s hold-back from further interest rate cutting. A resurgence of USD strength could assist USD/CAD in rising back above the 1.4100 level, with possible levels of resistance at 1.4150 and 1.4200. Also, any indications of stability or rebound in oil prices would assist the Canadian Dollar, but if oil demand prospects are brightened by softening global tensions, the pair’s higher limit could be curtailed. Conversely, a weaker inflation print might revive hopes of Fed rate cuts, pulling the US Dollar down and further lowering USD/CAD. A fall below the current support at 1.4050 might result in a more pronounced pullback towards 1.4000 or even 1.3960. If oil prices remain low based on ongoing demand issues or lingering US-China trade tensions, the Canadian Dollar might depreciate even more, halting the descent of USD/CAD even if there is stress on the US Dollar.

Read More
Currencies

USD/CAD Remains Flat Below 1.4350 On Fed Speculation and Canadian Politics

  • BY
  • March 24, 2025
  • 0 Comments

The USD/CAD currency pair begins the week cautiously trading just below the mid-1.4300s as conflicting market signals keep traders and investors nervous. While hopes of an eventual Fed rate cut dampen the US Dollar, lower Crude Oil prices and political instability in Canada—after Prime Minister Mark Carney demanded a snap election—cap the Canadian Dollar’s appreciation. In spite of intraday declines, the pair is still within last week’s range, indicating a lack of direction. With US PMI data and FOMC member speeches coming up, along with volatile oil prices, traders are waiting for new signals to decide the next direction in USD/CAD. KEY LOOKOUTS • Flash PMI prints and comments from prominent Federal Reserve members may steer short-term market sentiment and USD direction. • Short bets on an impending Fed rate-cut cycle are still a dominant force for USD movements and will keep influencing the trend in USD/CAD. • The surprise call for a snap election by Canadian Prime Minister Mark Carney injects uncertainty and could cap any sharp rise in the Canadian Dollar. • As a commodity-based currency, the CAD is still vulnerable to price movements in crude oil, so oil market fundamentals are an essential factor to monitor. Several factors affecting the USD/CAD in the short term need to be monitored closely by traders. Market interest will continue to be on US economic releases, specifically the flash PMI prints and Fed official speeches, which might provide new insights into the central bank’s monetary policy direction. Speculation over a possible Fed rate cut continues to pressure the US Dollar, while political tension in Canada after Prime Minister Mark Carney’s surprise election call might cap Canadian Dollar gains. Also, crude oil price volatility—considering CAD’s high correlation with oil—will be instrumental in determining the pair’s direction. Major areas of focus are future US PMI releases and FOMC speeches, which may influence USD sentiment. Speculation in the market regarding Fed rate cuts and Canada’s surprise election announcement may also impact USD/CAD movement. Also, oil price volatility is still important for the Loonie’s direction. • USD/CAD trades flat below the mid-1.4300s on mixed market signals. • Expectations of a Fed rate cut continue to bear down on the US Dollar. • Dovish Crude Oil prices constrain the Canadian Dollar’s rise. • Political risk increases with Canada’s PM announcing a snap election on April 28. • The market mood remains risk-averse with no definite directional bias. • The market waits for US flash PMI numbers and FOMC member speeches for new indications. • Price volatility in oil will continue to be a primary driver of USD/CAD direction. The USD/CAD pair is stable to start the new week, guided by a combination of economic and political events. Market participants closely monitor the situation unfolding in the US and Canada. On one side, the US Dollar is under pressure as there are growing hopes that the Federal Reserve might have rate cuts in the near term in view of economic slowdown concerns. On the other side, Canada’s political scenario has been given a fresh twist with Prime Minister Mark Carney declaring an unexpected election, raising doubts over future policy and investor sentiment towards the Canadian Dollar. USD/CAD Daily Price Chart Chart Source: TradingView Simultaneously, sentiment across broader markets is subdued as traders consider global economic indicators and geopolitical tensions. The Canadian Dollar, commonly sensitive to commodity prices, is also responding to oil price movements, which significantly determine its relative strength. In the near term, traders are likely to monitor closely the release of US economic data and speeches by Federal Reserve officials, which may provide more insight into the policy direction and its implications for currency movements. TECHNICAL ANALYSIS USD/CAD pair is range-bound, with prices staying just below the mid-1.4300s, indicating a lack of strong directional momentum. The pair has been able to bounce back from initial Asian session lows around 1.4325 but still trades in the wider range set last Friday. In spite of multiple attempts, the pair has failed to break convincingly above the 1.4400 resistance level, which suggests that buyers are reluctant without a definite bullish catalyst. On the negative side, support at the moment is around the 1.4300 level, and a persistent dip below this may draw in new selling interest. Until a break on either side happens, the pair will remain in this tight range, waiting for new impetus from economic news or political events. FORECAST Should market sentiment turn bullish for the US Dollar, perhaps in response to better-than-anticipated US economic news or more aggressive Federal Reserve rhetoric, USD/CAD may try to challenge the 1.4400 resistance level once again. A clear breakout above it may allow for additional upside, particularly if political uncertainty continues to pressure the Canadian Dollar. Also, if the price of oil continues to slide, it will add pressure to the Loonie, thereby supporting the trend in the USD/CAD to the upside. Conversely, in the event of Fed rate cut hopes gaining traction or if disappointing US data come out in the future, the US Dollar is likely to face fresh selling interest, causing USD/CAD to move lower. A drop below the 1.4300 support area may initiate additional weakness towards the 1.4260 or even 1.4200 levels. In addition, any improvement in Canada’s political scenario or a good bounce in crude oil prices might provide support to the Canadian Dollar, raising the risk of decline for the USD/CAD currency pair.

Read More