Forex News

• NZD/USD finds support in the 0.5800 area after Monday's reversal from 0.5864.
• Mixed data from China and caution about the US-Iran deal are weighing on the New Zealand Dollar on Tuesday.
• Technically, the pair is forming an inverted Head & Shoulders pattern.

The New Zealand Dollar (NZD) posts marginal losses against the US Dollar (USD) on Tuesday, trading at 0.5820 after bouncing up from session lows at 0.5795. The pair, however, remains vulnerable, following Monday’s rejection above 0.5860, weighed by a more cautious market mood and mixed data from China, a key partner.

Chinese Industrial production rose 4.5% year-on-year in May, beating expectations of a 4.4% reading, boosted by overseas trading, despite the restricted global shipping amid the crisis in the Strait of Hormuz. Retail Sales, on the other hand, fell 0.6% against expectations of a flat reading, revealing that domestic demand remains sluggish.

Beyond that, market sentiment has turned cautious, with investors awaiting details on the US-Iran peace deal, particularly regarding navigation through the Strait of Hormuz and Iran’s nuclear programme. This has provided some support for the US Dollar, which is also drawing support from investors' reluctance to bet against the USD ahead of Wednesday's Federal Reserve (Fed) decision.

Technical Analysis: Forming a bullish Head & Shoulders pattern

NZD/USD is bouncing up from session lows, forming an inverted Head & Shoulders (H&S) pattern, a common figure for trend shifts. Indicators in the 4-hour chart, however, show a lack of momentum. The Relative Strength Index (RSI) is around 50, while the Moving Average Convergence Divergence (MACD) has slipped marginally into negative territory, hinting that recovery attempts could remain shallow.

The H&S neckline meets the 38.2% Fibonacci retracement of the early-June selloff at 0.5857. Further up the June 4 and 5 highs, at the 0.5890 area and the 61.8% Fibonacci retracement of the mentioned cycle, at 0.5910 would be the next targets.

On the downside, initial support emerges at the mentioned 1.5800 area (session low), which is closing the path towards Thursday's low, at the 0.5760 area. Further down, the next bearish target is the year-to-date low, at the 0.5680 area.

(The technical analysis of this story was written with the help of an AI tool.)

According to UOB’s Quek Ser Leang, GBP/USD stalled just below key resistance at 1.3465 and closed near 1.3410, with intraday momentum indicators turning flat. The bank still sees scope for a break above 1.3465, though 1.3490 remains a tougher barrier, and warns that a drop below 1.3380 would signal a return to broader range trading.

Pound capped near key resistance band

"Following the sharp rise in GBP early yesterday, we indicated that “the rapid rise has room to test the major resistance at 1.3465.” We added, “a break above this level is not ruled out but note that there is another resistance at 1.3490.” However, GBP did not quite test 1.3465 as it retreated from a high of 1.3460."

"Momentum indicators are turning flat, and GBP is likely to trade sideways today, probably between 1.3390 and 1.3450."

"Yesterday (15 Jun, spot at 1.3415), we indicated that “while the increase in momentum suggests GBP could break above 1.3465, based on the prevailing momentum, it is too early to tell if GBP can break above 1.3490.” We added, “to sustain the rapid increase in upward momentum, GBP must hold above the ‘strong support’ level, now at 1.3380.”"

"GBP subsequently rose but did not break above 1.3465. That said, we will continue to hold the same view."

"Looking ahead, a breach of the ‘strong support’ level at 1.3380 would indicate that GBP is likely to remain in a range-trading phase."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

Societe Generale’s Kenneth Broux highlights that USD/CAD has broken above a key descending trendline and the upper boundary of a multi‑month base, signalling renewed upside momentum. The bank sees scope for gains towards 1.4030/1.4090 and the November 2025 peak near 1.4150, with the 1.3940/1.3900 area acting as initial short‑term support on any pullbacks.

Breakout targets higher resistance zone

"USD/CAD crossed the descending trendline drawn from 2025 and has now broken out above the upper boundary of a multi-month base."

"This highlights the upward momentum is regaining."

"The pair may extend the up move towards next projections of 1.4030/1.4090 and the peak of November 2025 near 1.4150."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

ING strategists Francesco Pesole, Chris Turner and Frantisek Taborsky note the Dollar is rallying again, supported by strong US data and Federal Reserve expectations despite sharply lower Oil prices. They argue tomorrow’s FOMC under new Chair Kevin Warsh is a key crossroads for FX, with markets shifting focus from energy to central bank communication and the US‑Iran deal leaving questions over the durability of the recent Oil sell-off.

Fed expectations keep Dollar supported

"The dollar is rallying again, displaying strong fundamental backing (data, Fed) despite sharply lower oil prices."

"The first 36 hours of trading after the US-Iran deal point to a structurally stronger dollar than a few weeks ago."

"This puts tomorrow’s FOMC firmly in focus for FX."

"The dollar can stay resilient, but needs a nod from policymakers (especially from new Chair Kevin Warsh) that rate hikes are a real possibility."

"This keeps questions around the durability of the oil sell-off open, and FX markets are, for now, reluctant to fully price in that optimism."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

UOB’s Quek Ser Leang highlights that EUR/USD failed to sustain gains above 1.1620 and closed at 1.1590, with momentum slowing. The bank still sees an upside bias over the next 1–3 weeks, but expects firm resistance at 1.1650 and stresses that the pair must hold above 1.1555, while a broader 1.1555–1.1750 range is envisaged for early 3Q26.

Euro holds bid but faces strong ceiling

"Following the surge in EUR early yesterday, we highlighted the following when it was at 1.1600: “The advance has scope to test 1.1620. A break above this level is not ruled out, but based on the prevailing momentum, a sustained rise above this level is unlikely. The next resistance at 1.1650 is also unlikely to come under threat.” Our view was not wrong, as EUR rose to 1.1622 and then retreated to close at 1.1590 (+0.19%)."

"The pullback amid slowing momentum suggests that EUR is likely to consolidate today, probably between 1.1570 and 1.1610."

"We indicated that “while the increasing upward momentum could lead to EUR trading with an upside bias, any advance is expected to face firm resistance at 1.1650.” EUR then tested the 1.1620 level (high was 1.1622) before easing."

"There has been no further increase in momentum, but we will continue to expect EUR to trade with an upside bias as long as it holds above 1.1555 (no change in ‘strong support’ level from yesterday)."

"Price action in early 3Q26 could be contained within a 1.1555/1.1750 range; 1.1555 appears to be more vulnerable, and a break of this level could open the way for a move to the significant weekly support zone of 1.1390/1.1410. (dated 05 Jun 2026, 1.1635) Read more"

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

Christopher Wong at OCBC notes Gold has rebounded about 5% as US‑Iran de‑escalation eased Oil-led inflation and rates shocks. He cautions that upside momentum may slow into the FOMC, with further gains dependent on softer Oil, lower yields and evidence Fed hawkish repricing has peaked. Key resistance lies around 4,394–4,580, with support at 4,200 and 4,024.

Upside hinges on macro easing signals

"Gold. Potential turn? Gold rebounded as US-Iran de-escalation narrative helped to unwind part of the oil led inflation and rates shock."

"The 5% rebound since Wed may potentially turn less even from here, with FOMC coming up while markets may shift focus from headline to details on US-Iran agreement."

"For gold to regain stronger upside momentum, a more durable improvement in the external environment is needed and this would include softer oil prices, yields to ease further and clearer evidence that Fed hawkish repricing has peaked."

"The latter will be a clear boost for gold prices – watch FOMC on Thu for clues."

"A sustained recovery above resistance at 4394 (23.6% fibo retracement of 2026 high to low), 4450 (200 DMA), 4580 (50 DMA) is needed to ease downside pressure. Otherwise, rallies may remain corrective. Support at 4200, 4024 (recent low)."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

Societe Generale’s Jin Kenzaki and team say the Bank of Japan’s hike to 1.0% marks only the bottom of the neutral range, but new language on upside inflation risks supports further normalisation. Their house view is for 25 bp hikes each quarter to a 2% terminal rate by end‑2027, which should favour Yen appreciation from cheap levels over time.

BoJ normalisation seen supporting currency

"Our house view is for the policy rate to increase at a cadence of 25bp every quarter to reach the terminal policy point of 2% by the end of next year."

"That’s 25bp above the mid-point of the neutral range, but a doubling of the policy rate, all else being equal in the US and the eurozone, legislates for Yen appreciation from cheap levels over the medium term."

"Tactically, the breakdown in correlation of the Yen and oil prices is puzzling but is offset by the widening in 2y UST/JGB spread to 265bp vs pre-war lows of around 211bp."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)