NZD/USD heads for fifth consecutive day of gains. Key levels to watch

The kiwi has quietly delivered an impressive performance over the past week, even against the euro and the yen. For NZD/USD, the dollar’s recent struggles have further contributed to the pair’s upward move in recent days. This is bringing a potential breakout of a key technical level into play, as seen on the chart.

The pair was consolidating at the start of the year, before testing the February lows during a drop earlier this month. That came on the back of initial concerns surrounding retaliatory tariffs announced by Trump. However, a strong recovery last week has continued into today.

The jump above 0.5900 is now bringing buyers back to the surface, with an attempt to break above the 200-day moving average (yellow line).

The November 29th high at 0.5928 may offer minor resistance, but the pair looks set to make a renewed push toward 0.6000.

There is a solid case that the kiwi is seeing more demand due to flows in the AUD/NZD pair. That cross dropped from 1.0900 to test 1.0700 in the past few days. A major driver appears to be growing trader bets on deeper rate cuts by the RBA.

While the RBNZ is also on a path toward easing, market expectations for the RBA have surged since the start of the tariff war. Traders are fully pricing in a rate cut at the next meeting, with around a 20% chance of a 50 basis point move. Markets are now pricing in roughly 121 basis points of cuts for the year – compared to about 72 basis points just after the April 1st meeting.

That said, the aussie has also performed well – especially over the past two sessions. Still, the kiwi retains the edge in terms of overall gains.

Looking back at NZD/USD – this is one of the charts to watch closely this week. But as always, headlines can quickly change the landscape, so stay alert.