NZD/USD Struggles Below 0.6000 Amid Stronger US Dollar
NZD/USD faces difficulty reclaiming the 0.6000 level as a stronger US Dollar benefit from cautious market sentiment
FUNDAMENTAL OVERVIEW:
The New Zealand Dollar is paring some losses in early European trading but remains down for the second straight day, pressured by risk-off sentiment following the latest escalation in Trump’s tariff actions.
NZD/USD has rebounded from a fresh three-week low of 0.5975, hit during Monday’s Asian session, yet struggles to reclaim the 0.6000-mark, trading about 0.25% below its daily open.
Over the weekend, U.S. President Trump unsettled markets by announcing 30% tariffs on imports from the European Union and Mexico—higher than the 20% and 25% tariffs introduced on April 2 (“Liberation Day”)—amplifying global trade uncertainty. As a result, risk-sensitive currencies like the Kiwi remain under pressure amid a cautious market tone.
However, the overall market reaction has been relatively muted, as the targeted countries have held off on retaliatory measures and continue to pursue a resolution before the August 1 deadline, helping to keep risk aversion contained.
On the macroeconomic front, trade data from China—New Zealand’s key trading partner—has offered some support to the NZD. China’s trade surplus exceeded expectations, driven by a strong rebound in exports amid easing trade tensions with the U.S.
These encouraging figures have boosted expectations for China’s second-quarter GDP, set for release on Tuesday, which could offer direction for the NZD in the absence of major domestic economic releases from New Zealand this week.
NZD/USD TECHNICAL ANALYSIS CHART:
Technical Overview:
NZD/USD is trading within a down channel.
NZD/USD is moving below all the Moving Averages (SMA).
The Relative Strength Index (RSI) is in the Neutral Zone, while the Stochastic oscillator suggests a Negative trend.
Immediate Resistance level: 0.5997
Immediate support level: 0.5984
HOW TO TRADE NZD/USD
On the higher time frame, NZD/USD initially reversed to the upside after breaking above resistance following a decline. However, the pair failed to sustain the breakout and has since turned lower, now trading near a key support level. A break below this support could trigger further downside movement.
