The NZD/USD currency pair reached a two-week high near 0.5980 during Monday’s European session, climbing 0.55% as risk appetite strengthened. The US Dollar faced downward pressure following weak economic data from the United States, sparking concerns about its economic trajectory.

The US Dollar Index (DXY) hovered close to critical support at 105.50, influenced by discouraging forecasts from the S&P Global PMI survey for April and lackluster Q1 GDP figures.

Investors are now paying attention to the Federal Reserve’s (Fed) upcoming monetary policy announcement scheduled for Wednesday. The CME FedWatch tool suggests that interest rates will remain steady within the 5.25%-5.50% range. As a result, market participants are keenly awaiting the Fed’s guidance on future interest rate movements, which will likely dictate the next moves in the US Dollar.

Trade Idea:

Consider a long position on NZD/USD; given the NZD’s recent strength and the US Dollar’s vulnerability, traders might explore long positions on the NZD/USD pair, anticipating further upside potential.