NZDUSD Analysis

Introduction

The NZD/USD, also a commodity currency pair, is highly sensitive to agricultural export prices (particularly dairy products) and global risk sentiment. The Reserve Bank of New Zealand (RBNZ) has a direct influence on the NZD through interest rate policy. The NZD tends to strengthen when global demand for New Zealand’s commodities rises. Like the AUD/USD, the NZD/USD is closely correlated with China’s economic health.

Fundamentals and Interest Rates

The Reserve Bank of New Zealand policy is Dovish with the (RBNZ) current Interest rate 3.75%. Latest change was Feb 19, 2025 (-50bp)%.
On that side the Federal Reserve policy is Dovish and (FED) has set its interest rate to 4.5% by latest change, Dec 18, 2024 (-25bp).
(FED) Higher interest rates generally lead to higher returns on investments denominated in USD. This tends to attract foreign capital into USD assets.

Based on the economic and macro fundamental data, The Fundamental Bias of NZD is Weak Bearish and for the USD is Moderate Bearish.
Ziwox considering Weak Bullish bias for this asset and we anticipate long-term price increases.
Our Ziwox A, mid-term Fundamental Score for NZD is -3. and Fundamental Score for USD is -3.

Market Overview & Performance

In the current trading session, "London & New York", Market risk sentiment is Strong Risk-OFF. The Gold and Switzerland Frank recorded the strongest performance, while the Yen and Australian dollar are weakest so far.

Currencies performance vs US dollar "USD"
Gold "XAU", recorded a 1.13% increase against us dollar.
Euro "EUR", performance has been -0.05% down so far
Pond "GBP", performance has been -0.18% down as of now
Australian dollar "AUD", has dropped by -0.39%
New Zealand dollar "NZD", has dropped by -0.2%
Japanese YEN "JPY", experienced -0.41% fall
Swiss franc "CHF", experienced 0.09% rise so far
Canadian dollar "CAD", has lost -0.02%
Market risk sentiment is OFF, Investors seek safety, favoring safe-haven currencies and assets while selling off riskier investments.Due to the market risk sentiment, NZDUSD price reduction is likely. Becasue investors become risk-averse from NZD, seeking safety amid uncertainty or market turmoil, leading to a sell-off in riskier assets and a flight to safe havens like the USD, JPY, and gold. Currencies tied to riskier economies (e.g., AUD, NZD) tend to weaken.

Market Sentiment and Positioning

NZD COT (Commitments of Traders):

Institutions Net Position on >Newseeland Dollar is -52931 included 16282 long, 69213 short and 2834 position changed from last week.
So they mainly have a bearish view on this asset and sold NZD for lower prices in long-term.
Last week 2834 repositioning Indicates closed positions and short-term profit-taking.

USD COT (Commitments of Traders):

Institutions Net Position on >U.S. Dollar Index is 16835 included 27969 long, 11134 short and 2097 position changed from last week.
So they mainly have a bullish view on this asset and bought USD for higher prices in long-term.
Last week 2097 repositioning Indicates that they are optimistic about higher prices in mid-term.

Retail Traders:

Crowd traders or Retail traders are bullish on the NZDUSD with 58% 42% ratio. 11020 long pos and 5721 short position.
We generally adopt a contrarian approach towards crowd sentiment and we give probability NZDUSD prices may decrease.

Technical Levels and Support/Resistance

The NZDUSD pair is approaching a critical technical support level near 0.57352.
Technical trend is BUY, If the pair continues to weaken, this support could become a good area to enter a long positions.
On the upside, there is key resistance near 0.58286. Technically, A break above this resistance could signal a shift in momentum, but need to get a confirmation in this area due to the reversal or correction potential.