NZD/USD Retreats Slightly From Monthly Peak but Holds Firm Above 0.5700

Fundamental Overview

NZD/USD is easing from its four-week high near 0.5730, yet remains well supported above the 0.5700 level, heading for a weekly gain of 1.7%—its strongest since May. The minor pullback is driven by a modest US Dollar rebound, though the broader bullish tone for the Kiwi remains intact.

Support for the New Zealand Dollar comes from policy divergence. The RBNZ delivered a ‘hawkish cut’, reducing rates by 25 bps to 2.25% while signaling an end to the easing cycle and reaffirming focus on medium-term inflation control.

Meanwhile, markets assign an 85% probability of a Fed rate cut on December 10, sharply higher than last month’s 40%, following soft US Retail Sales and dovish commentary from Fed officials. Speculation that NEC Director Kevin Hassett could replace Jerome Powell has also boosted expectations for an extended easing cycle through 2026, limiting USD upside.

NZD/USD Technical Analysis – Daily Chart

Technical Overview

• NZD/USD trades within a down channel.
• Price remains below the 50 & 100 SMAs.
• RSI sits in the bullish zone; Stochastic signals a neutral trend.
• Immediate Resistance: 0.5761
• Immediate Support: 0.5680

How to Trade NZD/USD

NZD/USD recovered strongly after a significant drop, gaining momentum as it broke above a key trendline resistance. The pair now faces upside rejection and is pulling back toward the trendline. A retest of this zone is likely. If the trendline support holds, the pair may resume its bullish continuation toward higher levels.

Trade Suggestion:
Limit Buy: 0.5662
Take Profit: 0.5772
Stop Loss: 0.5621

Frequently Asked Questions (FAQ)

Q1: Why did NZD/USD pull back today?
Mild US Dollar recovery after recent weakness.

Q2: What supports the Kiwi’s overall strength?
Policy divergence—RBNZ signaling the end of easing while the Fed is expected to cut rates.

Q3: What levels should traders watch?
Support at 0.5680, resistance at 0.5761.

Q4: What is the trend bias?
Bullish in the short term despite trading inside a broader down channel.

Q5: What could push NZD/USD higher?
A successful retest of the trendline support and renewed USD weakness.

Disclaimer

This report is for informational purposes only and does not constitute financial advice. Trading forex carries significant risk. Always conduct your own analysis or consult a licensed financial advisor before taking trading decisions.