NZD/USD sticks to modest gains around mid-0.5900s, upside potential seems limited

NZD/USD regains positive traction on Monday and is supported by subdued USD price action.
The upbeat market mood undermines the safe-haven buck and benefits the risk-sensitive Kiwi.
Bets that the Fed will keep rates higher for longer help limit the USD losses and cap the major.

Haresh Menghani FXStreet

The NZD/USD pair attracts fresh buying on the first day of a new week and stalls Friday's retracement slide from the 0.6015 area, or its highest level since August 11. Spot prices trade around the 0.5950-0.5955 region during the Asian session, up nearly 0.20% for the day, and draw support from a subdued US Dollar (USD) price action.

The mixed US monthly jobs report released on Friday ensures that the Fed will leave rates unchanged at its September meeting and fails to assist the USD to capitalize on last week's strong move up back closer to the August monthly swing high. Apart from this, the optimism over more supportive measures from China to shore up economic growth boosts investors' confidence and benefits antipodean currencies, including the New Zealand Dollar (NZD).

In fact, China's top economic planner – the National Development and Reform Commission (NDRC) – said that it would establish a designated department to bolster the country's faltering private economy. This comes after China increased local dollar liquidity and loosened some mortgage rules last week, which remains supportive of a positive tone around the equity markets. The upbeat mood further undermines the safe-haven buck and benefits the risk-sensitive Kiwi.

The upside for the NZD/USD pair, however, seems limited, warranting some caution for bullish traders and before positioning for any meaningful appreciating move in the near term. The markets seem convinced that the Fed will keep interest rates higher for longer and are still pricing in the possibility of one more 25 bps lift-off by the end of this year. The hawkish outlook continues to act as a tailwind for the Greenback and should keep a lid on any further gains for the major.

In the absence of any relevant market-moving economic releases and a bank holiday in the US, the aforementioned fundamental backdrop makes it prudent to wait for strong follow-through buying to confirm that the NZD/USD pair has bottomed out.

Technical levels to watch

NZD/USD

Overview
Today last price	0.5951
Today Daily Change	0.0005
Today Daily Change %	0.08
Today daily open	0.5946

Trends
Daily SMA20	0.5969
Daily SMA50	0.6103
Daily SMA100	0.6138
Daily SMA200	0.6221

Levels
Previous Daily High	0.6015
Previous Daily Low	0.5934
Previous Weekly High	0.6015
Previous Weekly Low	0.5887
Previous Monthly High	0.6219
Previous Monthly Low	0.5885
Daily Fibonacci 38.2%	0.5965
Daily Fibonacci 61.8%	0.5984
Daily Pivot Point S1	0.5915
Daily Pivot Point S2	0.5884
Daily Pivot Point S3	0.5834
Daily Pivot Point R1	0.5996
Daily Pivot Point R2	0.6046
Daily Pivot Point R3	0.6077

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

AUD/USD consolidates above 0.7000; remains close to monthly top

AUD/USD holds steady above 0.7000 during the Asian session on Friday, trading just below the previous day's monthly low amid diverging forces. A hawkish RBA continues to support the Aussie, while the recent decline in US bond yields keeps the US Dollar depressed near a three-week low. However, oil-driven inflation fears reinforce Fed hike bets, which, along with geopolitical risks, could benefit the safe-haven buck and cap the currency pair.

USD/JPY bounces off one-month low; climbs to 157.00 amid reviving USD demand

USD/JPY rebounds from the 156.00 neighborhood, or a one-month low touched during Friday’s Asian session, with bulls looking to extend momentum beyond 157.00 amid the emergence of some US Dollar buying. Meanwhile, Japan's National CPI rose to a nine-month peak and reaffirmed BoJ rate-hike bets, which could support the Japanese Yen and cap gains for the currency pair.

Gold treads water around $4,000

Gold prices maintain its offered stance in place at the end of the week, hovering around the key $4,000 threshold per troy ounce. The persistent selling bias in the precious metal comes amid decent gains in the US Dollar and an acceptable rebound in US Treasury yields across the curve, all alongside further upside traction in crude oil prices.

Crypto Today: Bitcoin holds the 50-day EMA as Ethereum and XRP face structural resistance

Bitcoin gradually ticks up on Friday, trading above $81,000. The Crypto King has recently defended structural support near $80,000, reinforcing the prevailing bullish outlook. Ethereum similarly edges higher above $2,400, while Ripple trades above $1.32 after testing support around $1.30.

The French bond panic is overdone. Here's what the market is misreading

France's 10-year government bond yield has climbed above 5%, reigniting fears of a sovereign debt crisis in the Eurozone. With public debt exceeding €3.5 trillion, persistent budget deficits and a fragmented political landscape, investors are increasingly questioning the French government's ability to stabilize its finances.

What November 3 means for the Fed's rate path and the US Dollar

The USD faces a decisive period ahead of the November 3 midterm elections. While markets anticipate another interest rate increase from the Fed in December, the battle for control of Congress could reshape fiscal policy expectations and, indirectly, the path of US monetary policy in 2027.