- Moody’s reduces the US credit rating, feeding the weakness of the USD.
- Trump announces negotiations of Alto El Fuego between Russia and Ukraine.
- Inflation expectations in New Zealand increase, but a rate cut is still expected.
The NZD/USD is rising at the beginning of the week, quoting around level 0.5900 after President Donald Trump claimed the credit to restart peace conversations between Russia and Ukraine. While Trump’s announcement relieved geopolitical tensions, the US dollar is still pressed about 100.30, after a reduction by Moody’s from AAA to AA1, citing concerns about the fiscal deterioration of the United States.
The president of the USA, Donald Trump, declared through Truth Social that Russia has agreed to return to the conversations of Alto El Fuego with Ukraine. Trump said that both parties would begin negotiations immediately, adding that the great trade between the US and Russia could be resumed after the war. Meanwhile, the Vatican has offered to house peace negotiations.
The American dollar index is further falling around 100.30 after Moody’s reduced US sovereign rating. The agency stressed that the US no longer maintains sufficient fiscal metrics to justify a first level rating. This reduction has increased risk premiums on US debt, which could limit the margin of the Fed to cut rates in the short term. Several Fed officials stated that clarity about economic perspectives may not reach summer, and the operators have now discounted around 75 basic points of rates cuts in the next 12 months.
In New Zealand, the second quarter inflation expectations increased to 2.3% from 2.2% in the first quarter. Despite this, the markets still expect the New Zealand reservation bank to reduce the official cash rate at 25 basic points later this month, with a projected terminal rate of 2.75% by the end of the year.
Technical analysis
The NZD/USD is showing a bullish signal, quoting around zone 0.5900 and showing a strong increase today. The torque is in the average range between its daily minimum of 0.5876 and its maximum of 0.5933. The Relative Force Index (RSI) remains in the 50s, indicating neutral conditions, while the convergence/divergence indicator of mobile socks (MACD) indicates a sale impulse. The amazing oscillator quotes around zero, suggesting a neutral impulse, as well as the product channel index (20). The stochastic %K (14, 3, 3) is found in the 20s, also pointing out neutral conditions.
While the simple mobile average (SMA) of 20 days suggests a sales signal, the SMAs of 100 and 200 days offer purchase signals, aligning with the feeling of purchase of the 10 -day exponential mobile average (EMA) and the 10 -day SMA. The support levels are about 0.5914, 0.5910 and 0.5905, while the resistance is expected around 0.5925, 0.5932 and 0.5934. Fibonacci supports are grouped around 0.5300, 0.5500 and 0.5600, with resistance about 0.6000, 0.6200 and 0.6400.
Changing to the 4 -hour time frame, the general signal remains bullish, supported by signs of purchase of the 4 -hour momentum (10) and the 4 -hour MacD level (12, 26), while the 4 -hour stochastic %K (14, 3, 3, 3) is neutral. The EMAS (10 and 20) and the SMAs (10 and 20) of 4 hours point to a purchase signal.
Daily graph
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
