NZD/USD regains upward traction on Thursday, attracting dip-buying interest after a brief pullback from recent highs. The pair advances toward the 0.5835–0.5840 region during the European session, marking a fourth consecutive day of gains as bulls attempt to break above the key 200-day Simple Moving Average.
The move is largely supported by continued weakness in the US Dollar following the latest signals from the Federal Open Market Committee. Minutes from the March meeting indicate that policymakers still expect only one rate cut this year and another in 2027, which has limited the Greenback’s recovery from recent lows. This softer outlook continues to provide support for risk-sensitive currencies, such as the New Zealand Dollar.
However, the broader backdrop remains mixed. Rising geopolitical tensions are keeping investors cautious and could cap further upside in NZD/USD. Israel has launched fresh airstrikes in Lebanon, stating that ceasefire arrangements do not extend to Hezbollah. In response, Iran has reportedly disrupted shipping through the Strait of Hormuz and warned it may withdraw from the ceasefire agreement if hostilities persist.
Adding to the uncertainty, Donald Trump has cautioned that the United States could resume military action if the agreement with Iran collapses. These developments continue to support the US Dollar’s safe-haven appeal, even as broader sentiment remains fragile.
Traders are also showing caution ahead of key US economic releases. The final Q4 GDP figures, along with the Personal Consumption Expenditures (PCE) Price Index and the upcoming Consumer Price Index (CPI), are expected to provide clearer signals on the Federal Reserve’s policy path.
From a technical perspective, the 200-day SMA remains a critical resistance level. A sustained break above this barrier would strengthen the bullish case and open the door for further gains. Until then, the pair may remain range-bound as markets balance USD weakness against geopolitical risks.
Trade Idea:
Buy NZD/USD above 0.5850 on confirmed breakout, targeting 0.5950, with a stop below 0.5790, as USD softness supports upside but resistance remains key.