Insights 
VT 
The NZD/USD continues to decline for the second day amid market apprehensions. The US Dollar strengthens due to trade tensions and diminished expectations for an immediate Federal Reserve rate cut, affecting the NZD.
Donald Trump announced 30% tariffs on EU and Mexican products set for August 1, reducing demand for risk-linked assets. Technical analysis supports a bearish outlook, with failure at the 100-period Simple Moving Average suggesting further declines.
Nzdusd Support And Resistance Levels
The NZD/USD now trades near the 0.5980-0.5975 support level. A sustained drop below the 61.8% Fibonacci retracement could lead to further losses, potentially reaching 0.5935 and even 0.5900, while resistance might emerge at 0.6025.
If the pair breaks 0.6025, it might rise to 0.6060 and possibly reclaim 0.6100. Further movement could test 0.6120, reversing the bias to favour buyers.
The US Dollar shows strength across various currencies over the past week, especially against the Yen. A visual heat map details percentage changes, providing insight into currency movements based on selected base and quote pairs.
Building upon the earlier analysis, it is now essential to understand that the wider strength exhibited by the US Dollar can be traced back to the shifting interest rate narrative in the United States. With rate cut expectations cooling off and trade frictions heating up, especially after Trump’s tariff announcement, appetite for higher-risk currencies like the New Zealand Dollar has taken a hit. This isn’t merely a knee-jerk reaction to headlines, but a broader adjustment as markets reassess where yields are headed over the next quarter.
From our view, traders who rely on price momentum and short-term interest rate dynamics may want to reassess their positions around the current levels of 0.5980-0.5975. This area has held up as solid interim support, but the price action is starting to erode confidence in its durability. If sellers hold pressure below this figure and the 61.8% Fibonacci retracement is breached with momentum, it would open the path toward 0.5935 next, with 0.5900 not far behind. These are not arbitrary figures—they are responses to the market digesting the move below technical midpoints that previously acted as balance zones.
The Broader Us Dollar Strength
At the same time, resistance is clear around 0.6025. This level isn’t just a price label—it aligns with recent highs where sellers have consistently stepped back in. Should buyers gather enough strength to push through this barrier, a quick move up to 0.6060 would not be out of the question, with more speculative interest likely to emerge near 0.6100 and 0.6120. That said, as long as the pair remains below 0.6025, the bias remains pointed downward.
Looking at the broader US Dollar strength, the heat map readings underscore just how widespread the upward momentum has been. Against the Yen, moves have been particularly forceful, but the resilience is not limited to that pairing alone. The Dollar’s firm grip across multiple currencies speaks to a repricing of relative interest expectations more than country-specific developments.
Just as important, we consider the volatility compression seen recently across some commodity-linked currencies. With external risks such as tariffs on EU and Mexican goods likely to continue weighing on sentiment, risk-sensitive currencies face an uphill path. Traders focused on derivatives may want to be nimble in managing exposure, especially near known breakout levels.
In the coming sessions, market participants should watch for any change in tone from Federal Reserve officials—as subtle remarks can skew pricing, particularly when the market is responding more to absence of dovishness than to any hawkish turn. Likewise, reaction to economic data will matter more than usual, since every number will be viewed through the lens of ‘how long until easing?’
With the technical picture combining with a hawkish repricing and souring risk tone, conditions favour positions aligned with the current Dollar strength until a break in momentum is visible. Not all support levels will hold when fundamentals are acting as tailwinds for one side.
