The EUR/USD currency pair continues to capture the attention of traders worldwide. Recent market dynamics have introduced both opportunities and risks with central banks adjusting their policies and geopolitical tensions influencing global markets. The pair’s movements have been anything but predictable.

Understanding these dynamics can help you operate more successfully in the forex market to capitalize on future EUR/USD exchange rate movements, whether you’re a seasoned trader or new to forex. In this analysis, Benzinga explores the technical and fundamental factors influencing the EUR/USD pair and offers valuable insights to help traders stay ahead in the ever-changing forex market.

Current Market Analysis

Since early March, EUR/USD has remained range-bound around 1.0840, influenced by mixed economic data, central bank decisions and geopolitical factors. The Federal Reserve’s dovish stance has softened the dollar, while concerns about stagflation and GDP revisions add uncertainty. Meanwhile, the European Central Bank’s cautious policy approach, inflation trends and German fiscal policies have impacted the euro. Trade tensions and the Russia-Ukraine conflict further complicate the EUR/USD outlook.

Recent data releases include the U.S. ISM Services PMI falling to 51.4 in March from 52.6, signaling slower expansion. Eurozone inflation eased to 2.4% in March from 2.6%, fueling speculation about future ECB rate cuts. Key upcoming economic data releases include: 

• U.S. Non-Farm Payrolls (NFP): Indicates labor market strength, often influencing Fed rate decisions.
• Eurozone Services PMI: Final March readings will provide insights into business activity.
• U.S. PCE Price Index: The Fed’s preferred inflation measure, which could shift rate expectations.

Based on our forex market analysis detailed below, these data points will likely drive short-term volatility in the EUR/USD market.

Technical Analysis

From a technical analysis perspective, EUR/USD faces key support at 1.0815 and resistance at 1.0955. A breakout above 1.0955 could lead to a test of 1.1000 and potentially 1.1542. Conversely, a sustained drop below 1.0815 might signal a bearish reversal toward 1.0630 or 1.0533. A daily chart for the EUR/USD pair’s exchange rate appears below. 

Daily exchange rate candlestick chart of the EUR/USD currency pair showing the 50 and 100 period moving averages in blue and orange respectively, and the 14 period RSI in the indicator box below the chart. Source: Metatrader5.

Flag Pattern Overview:

• Flagpole: A sharp rally from 1.0360 to 1.0947 indicates strong bullish momentum.
• Consolidation Phase: The pair has formed a downward-sloping flag with support at 1.0815 and resistance at 1.0955.
• Breakout Levels: A move above 1.0955 would confirm a bullish continuation, while a sustained drop below 1.0815 could invalidate the pattern.

Technical Indicators:

• Moving Averages: The 50-day SMA is rising, indicating a bullish outlook. It is also close to crossing the 100-day SMA, which would help confirm an uptrend.
• Relative Strength Index (RSI): The 14-day RSI is currently at 62, showing neutral momentum with room for an upside breakout, although a recent bearish divergence in overbought territory prompted a declining consolidation phase.
• Volume: A breakout above 1.0955 should be accompanied by increased trading volume to confirm the bullish flag breakout.

Potential Scenarios:

1.        Bullish Breakout: A move above 1.0955 could target 1.1002 and 1.1201, with a long-term measured move projection of the bullish flag pattern near 1.1542.

2.        Bearish Breakdown: A sustained break below 1.0815 could trigger declines toward 1.0630 or 1.0533.

Traders should monitor the aforementioned breakout levels and use stop-loss orders wisely. A confirmed breakout above 1.0955 offers a buying opportunity to benefit from the bullish flag pattern’s estimated 1.1542 target, while a prolonged breakdown below support at 1.0815 could negate the bullish outlook.

Fundamental Analysis

Economic indicators are key in shaping the EUR/USD currency pair’s movements in the forex market. In the U.S., slower GDP growth and inflation concerns have influenced the Federal Reserve’s recent policy decisions. Conversely, the euro has been buoyed by upgraded inflation forecasts and Germany’s fiscal initiatives. Political events, such as trade wars and peace negotiations in the Ukraine-Russia conflict, add another layer of uncertainty to the dynamics of the EUR/USD pair’s exchange rate. Understanding these factors is essential for making an accurate EUR/USD forecast of the pair’s future direction. Relevant recent fundamental details for EUR/USD include:

Eurozone Fundamental Economic Outlook:

• HICP Inflation: March 2025 headline inflation at 2.3%, with core inflation at 2.2%.
• GDP Growth: Flat at 0.0% in Q4 2024, raising concerns about economic recovery.
• ECB Rate Decision: The ECB cut its deposit rate by 25 bps to 2.5% in March 2025.
• PMI Data: Eurozone Composite PMI came out at 49.8 For February 2025, indicating contraction.

U.S. Fundamental Economic Outlook:

• NFP Data: February 2025 job growth was 190,000, slightly above expectations.
• CPI Inflation: February 2025 inflation at 2.8%, down from 3.0% in January.
• PCE Price Index: Core PCE inflation for February 2025 was 2.8%, reflecting a gradual decline.
• Federal Reserve Policy: Maintained target range at 4.25%-4.50% in March 2025, emphasizing a cautious approach amid mixed economic signals.
• ISM PMI Data: The February 2025 manufacturing PMI was 48.5, indicating contraction, with the Services PMI at 51.4, signaling slower expansion.
• GDP Growth: Q4 2024 at 2.3% year-over-year, below the 2.6% market consensus.

Forex Market Implications:

• U.S. Economy: Slower GDP growth and weaker ISM Services PMI data have softened the dollar, while the labor market remains a key focus.
• Eurozone Economy: Declining inflation and mixed PMI data raise questions about the ECB’s next policy moves. Speculation about rate cuts in June could weigh on the euro.
• Diverging Central Bank Policies: A hawkish ECB and dovish Fed could push EUR/USD higher, while the opposite scenario would favor dollar strength.
• Economic Surprises: Unexpectedly strong or weak data can cause sharp movements in EUR/USD.
• Geopolitical Risks: Trade tensions and the Russia-Ukraine conflict add uncertainty, influencing risk sentiment and market direction.

Forecast for the EUR/USD Pair

Benzinga’s EUR/USD forecast includes both near- and longer-term outlooks as follows:

Near-Term Outlook:

In the short term, EUR/USD will likely remain range-bound between 1.0800 and 1.0955. Key drivers include:

• Eurozone Weakness: The ECB’s recent rate cut and declining inflation suggest a dovish stance, potentially weighing on the euro.
• U.S. Labor Market Data: The upcoming NFP report will be critical. A weaker-than-expected result could pressure the dollar, allowing the euro to gain ground.
• Geopolitical Risks: Ongoing tensions in Eastern Europe and global trade uncertainties may lead to risk aversion, benefiting the dollar as a safe-haven currency.

If U.S. data outperforms expectations, the pair may test support at 1.0815, but a break above 1.0955 on weak U.S. economic results could trigger a bullish move toward 1.1000 and the 1.1201/14 region, with a long-term target set near 1.1542.

Longer-Term Outlook:

The EUR/USD pair’s direction will depend on economic fundamentals, central bank policies and technical factors as follows:

1.        Bullish Scenario:

• Stronger Eurozone GDP growth and improved sentiment.
• Resolution of the bullish flag pattern to the upside. 
• A dovish Fed leading to dollar weakness.
• EUR/USD target levels: 1.1200–1.1500 by late 2025.

2.        Bearish Scenario:

• Eurozone stagnation or political instability.
• Strong U.S. economic performance and a hawkish Fed.
• EUR/USD target levels: 1.0300–1.0500.

3.        Geopolitical and Structural Factors:

• Structural reforms in the Eurozone could support the euro.
• Increased geopolitical risks may favor the dollar.

Capitalizing on EUR/USD Exchange Rate Movements

To take advantage of EUR/USD exchange rate movements and the forecasts in this article, consider signing up with a top online forex broker like FOREX.com. As a trusted broker for many retail traders, FOREX.com offers advanced trading tools, competitive dealing spreads and a user-friendly trading platform to help you confidently monitor and execute your trades. Whether you’re a beginner or an experienced currency trader, FOREX.com provides the resources needed to succeed in the forex market.

The post EUR/USD Forecast by Julie Hawk appeared first on Benzinga. Visit Benzinga to get more great content like this.

In recent years, trade policies implemented during U.S. President Donald Trump’s previous and current administrations have significantly shaped the global economic landscape. Among the more controversial and protectionist of these policies, the imposition of tariffs on a range of imported goods has had a profound impact on the U.S. dollar and broader currency markets.

In this article, Benzinga explores the impact of Trump’s tariffs on the US dollar, including the immediate and long-term effects on the USD’s valuation, how major global currencies responded to these developments, and the implications for currency traders and investors in foreign markets. Understanding these factors and how to trade forex strategically will help you operate in a tariff-driven forex market more effectively.

Market Reaction to Trump’s Tariff Announcement

The introduction of tariffs by the first Trump administration generated swift and notable reactions in currency markets. Initially, the U.S. dollar experienced upward momentum as market operators sought the security of a stable currency amidst growing economic uncertainty. This was particularly evident when tariffs targeted major U.S. trade partners, such as China, Mexico and Canada, leading to notable depreciation in the Chinese yuan (CNY), Mexican peso (MXN) and Canadian dollar (CAD) relative to the greenback. 

However, while the US dollar strengthened in the short term, its long-term trajectory was more complex. Extended trade tensions, retaliatory measures and shifting global supply chains introduced increased forex market volatility and USD instability. As uncertainty persisted, the dollar’s gains were tempered by concerns about an economic slowdown and inflationary pressures. Furthermore, retaliatory tariffs from affected nations led to unpredictable shifts in trade flows, contributing to currency market instability.

When the Biden administration took over, it maintained some tariffs while modifying others, and the ongoing trade tensions, especially between the U.S. and China, continued to influence Chinese yuan and U.S. dollar fluctuations. In addition, global economic concerns, such as supply chain disruptions and geopolitical events, kept the U.S. dollar in high demand as a safe-haven asset, reinforcing some trends seen during the preceding Trump administration.

In the early months of President Donald Trump’s second term, the administration swiftly reintroduced aggressive trade policies, notably imposing a 25% tariff on imports from Canada and Mexico on Feb. 1, 2025, to take effect on the 4th. On the 4th, President Donald Trump then imposed a 10% tariff on Chinese imports after coming to a last-minute agreement with Canada and Mexico to delay the tariffs by 30 days. 

These measures have led to significant volatility in the foreign exchange market as participants react to tariff-related news and the risk of potential disruptions in trade relations with the US’s main trading partners. The chart below shows that the Canadian dollar and Mexican peso have faced notable downward pressure due to anticipated economic slowdowns resulting from reduced export competitiveness. At the same time, safe-haven currencies like the CHF and JPY have appreciated relative to the USD. These currency movements reflect general apprehension in the forex market about the broader economic implications of renewed protectionist policies in the US.

Four-hour candlestick exchange rate charts for the USD/JPY and USD/CHF pairs shown on the left, with the USD/CAD and USD/MXN pairs shown on the right. The rightmost two charts display a sharp spike in the forex market on the day trade tariffs were announced against Canada and Mexico, while the leftmost charts show the subsequent appreciation of the JPY and CHF safe-haven currencies. Source: MetaTrader5

The Trump administration’s tariffs on Chinese goods have also contributed to market uncertainty. The prospect of escalating trade tensions with China has prompted investors to seek safe-haven assets as a trade war and forex market volatility loom, strengthening the U.S. dollar against a basket of global currencies. This trend underscores the dollar’s role as a refuge during geopolitical and economic instability.

Overall, the reimplementation of trade tariffs under President Donald Trump’s renewed “America First” agenda is notably affecting the forex market. These policies have significant implications for relative currency valuations and global trade dynamics.

How Tariffs Affect Currency Markets

Tariffs function as taxes on imported goods, directly increasing their cost for domestic consumers and businesses. This can lead to higher prices, reduced consumer spending and shifts in global trade dynamics. Historically, trade barriers have created market volatility as traders and investors adjust to anticipated economic consequences.

For example, during the U.S.-China trade war, the imposition of tariffs triggered significant fluctuations in foreign exchange markets. Initially, the U.S. dollar strengthened due to investor risk aversion. As the trade dispute escalated and its economic toll became evident, pressure mounted on the dollar, and the Chinese government used measures such as currency devaluation to offset tariff impacts. 

Similar patterns were observed with the Mexican peso and Canadian dollar, which faced downward pressure amid uncertainty over renegotiations of the North American Free Trade Agreement (NAFTA), later replaced by the U.S.-Mexico-Canada Agreement (USMCA).

In recent years, global trade policy has remained a key factor influencing currency markets. The Biden administration maintained a strategic stance on tariffs, particularly against China, while negotiating trade agreements with European and Asian partners. Ongoing trade tariff developments under the new Trump administration will continue to play a key role in relative currency valuations and forex market movements.

Inflation Factors and the Impact on Fed Policy

One of the most significant ways tariffs influence a nation’s economy is through their impact on inflation. By raising the cost of imported goods, tariffs contribute to upward pressure on prices, complicating monetary policy decisions by the nation’s central bank.

In the US, higher inflation often leads the Federal Reserve (Fed) to consider maintaining or increasing interest rates to curb rising prices, thereby strengthening the dollar. However, if trade-induced economic slowdowns worsen, the Fed may opt for rate cuts to stimulate growth, potentially weakening the dollar.

During Trump’s past and current tariff regimes, inflationary pressures fluctuated based on the sectors affected by trade policies. While some domestic industries benefited from protectionist measures, consumers faced higher prices on goods reliant on imported components. The Fed must carefully balance these dynamics when setting interest rates.

More recently, inflation has emerged as a dominant concern due to pandemic-related supply chain disruptions, increased government spending and rising energy costs. The Fed adopted an aggressive approach to managing inflation, with multiple rate hikes in 2022 and 2023. While tariffs are no longer the primary driver of inflationary concerns, their effects persist in specific industries, influencing trade balances and monetary policy considerations.

Since 2023, the Federal Reserve has transitioned from an aggressive tightening cycle to cautious easing in response to shifting economic conditions. After maintaining interest rates at a peak of 5.25% – 5.50% to combat inflation, the Fed implemented its first rate cut in September 2024, followed by another in December, bringing rates down to 4.25% – 4.50%. These downward rate adjustments were driven by moderating inflation and slowing economic growth.

In early 2025, the Fed’s FOMC held rates steady, emphasizing a data-driven approach amid persistent inflation concerns and economic uncertainty. This policy shift reflects the Fed’s balancing act between controlling inflation and sustaining economic stability. Still, the new Trump administration’s swiftly reintroduced aggressive trade policies have led to immediate volatility in foreign exchange markets. Inflation is expected to rise in response, which could, in turn, provoke a tightening move by the Fed.

The U.S. Dollar as a Safe-Haven Currency

In times of economic uncertainty, the U.S. dollar often serves as a safe-haven asset, attracting investors seeking stability and liquidity. This behavior was particularly evident during tariff escalations when global markets faced heightened volatility and traders and investors moved capital into dollar-denominated assets as a precautionary measure.

The dollar’s safe-haven status is important for forex trading and risk management. Traders and investors frequently adjust their portfolios to incorporate more U.S. dollars in response to forex market turbulence, taking advantage of its relative stability. Central banks worldwide also maintain substantial dollar reserves, reinforcing the US currency’s dominant role in global finance.

This trend has continued in recent years, with geopolitical tensions, inflationary concerns and global recession risks further solidifying the dollar’s position as the go-to safe-haven currency. Even as trade policies evolve, the dollar remains a preferred asset during economic distress.

Trading Strategies in a Tariff-Driven Market

Operating successfully in the forex market amid tariff-induced volatility requires a strategic approach and sound risk management techniques. Currency traders must implement various forex trading strategy techniques to mitigate their risk while remaining sufficiently exposed to capitalize on market fluctuations.

For investors in foreign markets, one of the more effective strategies is prioritizing safe-haven currencies, such as the U.S. dollar, Swiss franc (CHF) and Japanese yen (JPY), which tend to perform well during periods of economic uncertainty.

Hedging strategies also play a key role in managing currency risks, especially for US corporations with foreign operations. Hedgers may use options and forward and future contracts to protect against adverse currency movements. Closely monitoring policy changes and economic indicators allows all forex market participants to anticipate market shifts better and adjust their positions accordingly.

Since Trump’s second presidency, new economic challenges – such as post-pandemic recovery, supply chain disruptions and ongoing trade negotiations – have continued to influence currency market activity. Traders, investors and hedgers alike must remain adaptable and stay informed about global trade policies and central bank responses to operate effectively in the forex market.

Overall, the tariffs introduced during Trump’s two presidencies have far-reaching effects on the U.S. dollar and global currency markets, creating opportunities and challenges for traders and investors. As global trade policies evolve, understanding the impact of trade tariffs remains vital for forex market participants. Using strategic approaches and staying informed on economic and policy developments, those with foreign currency exposures can better succeed in a tariff-driven market environment.

The post Analyzing Trump’s Tariffs: Impacts on the U.S. Dollar and Currency Trading by Julie Hawk appeared first on Benzinga. Visit Benzinga to get more great content like this.

The NZD/USD currency pair has been consolidating in recent weeks as the market experiences a tug-of-war between notable technical and fundamental factors. Recent exchange rate movements suggest this consolidation pattern will break soon, so the pair should be watched closely for a trading opportunity. Kiwi traders also eagerly watch the Fed and RBNZ for anticipated central bank rate decisions.

In this article, Benzinga provides an in-depth analysis of the current market conditions for NZD/USD, explores technical and fundamental perspectives for the currency pair, and presents a detailed NZD/USD forecast for the pair’s future direction, so keep reading!

Current Market Analysis

The NZD/USD pair has shown some volatility recently. As of Feb. 11, 2025, the pair traded around 0.5650, slightly increasing from previous levels. The pair broke above its 20-day Simple Moving Average (SMA), indicating renewed bullish momentum. However, the outlook remains mixed, with potential resistance at 0.5700 and support seen around 0.5603 on the chart for the pair.

The following factors have been influencing the market for NZD/USD: 

Economic Data

• U.S. Economic Data: Weaker-than-expected U.S. economic data, such as the ISM Services PMI, has weighed on the U.S. Dollar, boosting the NZD/USD pair.
• New Zealand Economic Data: New Zealand’s unemployment rate rose to 5.1% in Q4 2024, leading to expectations of further interest rate cuts by the Reserve Bank of New Zealand (RBNZ).

Central Bank Policies

• Federal Reserve (Fed): Investors have been closely watching Fed Chair Jerome Powell’s testimony and comments on tariffs and inflation. The Fed’s stance on monetary policy adjustments will influence the USD’s strength.
• Reserve Bank of New Zealand (RBNZ): The RBNZ has already cut interest rates by 125 basis points to 4.25%. Due to a weak labor market, it is expected to continue easing monetary policy via cuts in its Official Cash Rate at coming policy meetings. The financial markets anticipate another 50 basis point rate cut to 3.75% at the RBNZ’s Feb. 19 meeting. The policy rate is expected to fall as low as 3.00% over the coming year.

Geopolitical Events

• US-China Trade Tensions: The recent increase in tariffs on steel and aluminum imports by the Trump administration and China’s retaliatory tariffs have heightened global trade war concerns. Given New Zealand’s key trading relationship with China, this uncertainty can adversely impact the NZD/USD pair.

Technical Analysis

This section contains a detailed technical analysis rundown for the NZD/USD currency pair. It includes technical indicators such as key support and resistance levels, moving averages and trend lines that can help you identify potential future exchange rate moves. A daily chart for the pair’s exchange rate appears below.

Daily exchange rate candlestick chart of the NZD/USD currency pair showing the 50- and 100-period moving averages in blue and orange, respectively, key converging trendlines in red and the 14-period RSI in the indicator box below the chart. Source: Metatrader 5.

Support and Resistance Levels

The NZD/USD pair is currently nearing resistance at 0.5694, with additional resistance seen above at 0.5702 and 0.5722. On the downside, the key support levels are at 0.5625 and 0.5610/19, with a further support area between 0.5541 and 0.5563. A break below this region could lead the pair toward testing the key 0.5516 level, its lowest point since October 2022.

Trendlines

On the 4-hour timeframe, NZD/USD is in an uptrend, creating new highs and lows within two converging trendlines. The exchange rate recently broke through the previous minor key resistance at 0.5675 and broke above a trendline that can be considered another minor support level. The overall pattern indicates that the pair is in a consolidation phase within a triangular pattern.

Relative Strength Index (RSI)

The 14-day RSI is positioned slightly below the 50 level at 49.24, suggesting a neutral to mildly bearish market bias. 

Moving Averages

The NZD/USD pair remains below its 50- and 100-day Simple Moving Averages (SMAs), which lie around 0.5673 and 0.5850, respectively. These SMAs act as pivotal levels for the pair’s medium-term market direction, and a decisive break above them could accelerate the upside substantially. 

Elliott Wave Analysis

The Elliott Wave analysis suggests that the NZD/USD pair is in the third wave of a five-wave uptrend. The recent breakout above 0.56750 confirms the continuation of this trend, with potential targets around 0.5794 and 0.5800.

Chart Patterns

The NZD/USD pair seems to be consolidating within a triangular pattern bounded by two converging trendlines. Since the pattern looks to be nearing its completion point, traders should watch closely for a break of either trendline, which would be expected to result in a sharp move of around 200 pips projected from the trendline breakout point in the direction of the breakout. 

Fundamental Analysis

This section examines the impact of fundamental factors such as economic indicators, central bank policies, geopolitical events and other global factors on the NZD/USD currency pair.

U.S. Fundamental Overview

U.S. Economy

The U.S. economy is experiencing moderate growth, with real GDP increasing at an annual rate of 2.3% in Q4 2024. Increases in consumer and government spending primarily drove this growth, although a decrease in investment partly offset it. The unemployment rate has remained relatively stable at 4.0% as of January 2025.

Economic Indicators

• GDP Growth: The U.S. economy grew by 2.3% in Q4 2024, following a 3.1% growth in Q3 2024.
• Personal Income and Outlays: Personal income increased by 0.4% in December 2024, while personal consumption expenditures (PCE) increased by 0.7%.
• Trade Deficit: The U.S. current account deficit widened to $310.9 billion in Q3 2024, up from $275.0 billion in Q2 2024.

Central Bank Monetary Policy

The Federal Reserve has maintained a cautious stance on monetary policy, with the Federal Funds Rate currently at 4.75%. Fed Chair Jerome Powell has indicated that the central bank is closely monitoring inflation and trade policies to determine future rate adjustments.

Geopolitical Events

Trade tensions between the U.S. and China continue to impact market sentiment. The US’s recent increase in tariffs on steel and aluminum imports, along with China’s retaliatory tariffs, has heightened concerns about a potential escalation in the trade war.

New Zealand Fundamental Overview

New Zealand Economy

The New Zealand economy has recently shown sluggish growth, with the GDP growth rate slowing to 2.3% in Q4 2024. The unemployment rate has risen to 5.1% in the December 2024 quarter, reflecting ongoing challenges in the labor market. Inflation has been relatively contained, with the Consumer Price Index (CPI) increasing by 2.2% annually in Q4 2024, remaining within the Reserve Bank of New Zealand’s target range. 

Central Bank Monetary Policy

The Reserve Bank of New Zealand (RBNZ) is widely expected to cut interest rates by 50 basis points to 3.75% at its policy meeting on February 19. RBNZ Chief Economist Paul Conway highlighted the need to cautiously adjust monetary policy, noting that the current 4.25% official cash rate (OCR) remains restrictive compared to the estimated neutral range of 2.5% to 3.5%. Conway indicated further cuts are likely, with the central bank signaling a potential 50 basis-point reduction in its next meeting. Inflation in the fourth quarter dropped to an annual rate of 2.2%, comfortably within the central bank’s 1%-3% target range for the second consecutive quarter.

Global Trade

Trade negotiations between the U.S. and China could impact the NZD/USD pair. The NZD/USD pair has been vulnerable amid US-China trade tensions, with the additional U.S. levy on China and China’s retaliatory tariffs on some U.S. exports raising the risk of a further escalation of the trade war between the world’s two largest economies. This has weighed on investor sentiment, underpinning the safe-haven U.S. Dollar (USD) and denting demand for the perceived riskier Kiwi.

Dairy Prices

High dairy prices can boost New Zealand’s export income, positively impacting the NZD relative to the USD. According to the latest data, dairy prices have remained strong, contributing to New Zealand’s export income and supporting the NZD. The RBNZ expects economic growth to recover during 2025 as lower interest rates encourage investment and other spending.

Forecast for the NZD/USD Pair

This section contains potential scenarios for exchange rate movements in the short, medium and long terms for the NZD/USD currency pair. 

Short-Term Forecast (Next 1-3 Months)

Short-term trading in the NZD/USD pair is expected to remain cautious ahead of key economic data releases such as the U.S. Nonfarm Payrolls (NFP) report and the upcoming RBNZ policy meeting. From a technical perspective, the pair is currently testing resistance around 0.5650. If it breaks above this level, it could reach 0.5794, but if it remains below that level, it might pull back to 0.5550. The short-term outlook is somewhat bearish due to the 14-day RSI being below the central 50 level.

Medium-Term Forecast (Next 3-6 Months)

In the medium term, the NZD/USD pair is expected to rise to around 0.5929 by the end of 2025’s first quarter. This would represent a 5.09% increase from the current exchange rate. The medium-term forecast for the pair also remains bullish after that, with potential further gains to 0.6028 expected by the third quarter of 2025.

Long-Term Forecast (Next 6-12 Months)

The NZD/USD pair is projected to continue its upward trend, potentially reaching the 0.6200 level by the first quarter of 2026. This would significantly increase the exchange rate by approximately 9.89% from the current rate.

Conclusion

Overall, the NZD/USD pair remains in a critical phase, with technical indicators, including trendline and wave analysis, and fundamental data aligning to suggest a near-term breakout of a triangular consolidation pattern. Kiwi traders should also pay close attention to any economic data releases that could impact central bank monetary policy decisions.

For those looking to profit from trading the Kiwi, top online forex trading platforms like FOREX.com will give you the tools, competitive dealing spreads and insights you need to operate effectively in the forex market and capitalize on future NZD/USD market moves.

The post NZD/USD Forecast • News & Analysis by Julie Hawk appeared first on Benzinga. Visit Benzinga to get more great content like this.

The USD/CHF currency pair has been experiencing significant market activity in recent weeks, influenced by technical and fundamental factors. Recent exchange rate movements suggest that a near-term corrective consolidation phase lower may be followed by a notable rally as underlying economic data and central bank policies continue to shape market sentiment. 

Swissie traders are now keenly watching key nearby resistance and support levels for potential breakout opportunities, especially to the upside where a major medium-term trendline has just been tested and could give way shortly. 

In this article, Benzinga provides an in-depth analysis of the current market conditions for USD/CHF, explores technical and fundamental perspectives for the currency pair and presents a detailed USD/CHF forecast for the pair’s future direction, so let’s dive in now!

Current Market Analysis

This section provides an overview of recent exchange rate movements in the USD/CHF currency pair, including factors influencing the market such as economic data, central bank policies and geopolitical events.

The USD/CHF pair has demonstrated strength in recent sessions, maintaining its position above key support levels. Currently trading around 0.9135, the pair has been consolidating within the 0.8965-0.9206 range but now seems poised for an upside breakout. Market participants have observed resilience in the U.S. dollar, driven by economic data and evolving central bank policies.

From a fundamental perspective, the U.S. dollar has gained momentum due to President Donald Trump’s newly imposed tariffs on imports from Mexico, Canada and China. These measures have reinforced a bullish sentiment toward the USD/CHF pair. In addition, U.S. bond yields have rebounded, further supporting the dollar’s recent strength.

In contrast, the Swiss franc has faced downward pressure, mainly due to the Swiss National Bank’s (SNB) cautious monetary policy stance. While the SNB has not implemented negative interest rates yet, it has indicated a willingness to do so if inflation remains subdued. Furthermore, Switzerland’s projected budget deficits of around three billion Swiss francs in the coming years highlight potential economic challenges.

Key Factors Influencing the USD/CHF Market

Several significant factors are currently impacting the USD/CHF exchange rate:

• Trade Policy: President Donald Trump’s newly implemented tariffs on imports from Mexico, Canada and China have strengthened the U.S. dollar, contributing to a bullish outlook for the USD/CHF pair. Trade tensions can drive demand for safe-haven assets like the Swiss franc. Still, in this case, the USD has gained momentum due to investor and trader confidence in the U.S. economy going forward under the Trump administration.
  
• Central Bank Policies: The Federal Reserve’s monetary policy stance remains a key factor for this pair, with the recent 2.6% increase in the U.S. Personal Consumption Expenditures (PCE) Price Index reinforcing expectations of tighter U.S. monetary policy. In contrast, the Swiss National Bank (SNB) has indicated a willingness to implement negative interest rates if inflation remains low, a dovish stance contributing to CHF weakness.
  
• Economic Data: Recent U.S. economic data, such as the recovery in bond yields and stronger-than-expected inflation, has supported the USD. On the Swiss side, the 2.6% rise in Real Retail Sales suggests economic resilience, which could limit USD/CHF gains in the near term. Meanwhile, Switzerland’s forecast budget deficits could put further pressure on the CHF in the long run.

Technical Analysis

This section provides a technical analysis of key support and resistance levels and other technical factors for the USD/CHF pair. A daily chart for the pair’s exchange rate appears below.

Daily exchange rate candlestick chart of the USD/CHF currency pair showing the 50 and 100 period moving averages in blue and orange respectively, a key trendline in red, and the 14 period RSI in the indicator box below the chart. Source: Metatrader5.

From a technical standpoint, the USD/CHF pair has surpassed key resistance levels, with the next major resistance level identified at 0.9180. A sustained move above this level could pave the way for further gains. However, a major declining trendline, drawn through the highs of 0.9201, 0.9224 and 0.9245, currently sits at 0.9202, presenting a substantial resistance zone. 

Also, the exchange rate remains above its 50 and 100-day moving averages, while the pair’s 14-day RSI is rising but not yet in overbought territory. This clears the way for further medium-term gains for the USD/CHF pair. 

Elliott Wave Theory analysis indicates that the pair has been in an impulsive five-wave upward movement since the Sept. 6, 2024, low of 0.8373, culminating in a high of 0.9201 on Jan. 12, 2025. This suggests that the pair is now undergoing a corrective pullback phase within the broader bullish trend that should shortly resume with a strongly bullish third of a third wave. 

An initial Wave A within a bearish Wave 2 of three has likely already taken place, with an expected B wave upwards followed by a C wave decline that should dip briefly below the bottom of A at 0.8965. The invalidation level for this structure is the 0.8373 low. If breached, it would require a reassessment of the current bullish market outlook for USD/CHF.

Fundamental Analysis

The following sections examine economic indicators and geopolitical events affecting the USD and CHF that could significantly impact the currency pair’s future direction. 

USD Outlook

• The U.S. economy has seen rising inflation, with the Personal Consumption Expenditures (PCE) Price Index increasing by 2.6% year-over-year in December. This aligns with market expectations and reinforces the likelihood of a tighter monetary policy by the Federal Reserve, which typically strengthens the U.S. dollar.
• U.S. bond yields have recovered, supporting the USD’s upward movement.
• Trade restriction policies, including tariffs on major trading partners imposed by incoming U.S. President Donald Trump, have contributed notably to the dollar’s bullish momentum.

CHF Outlook

• The SNB has maintained a neutral policy stance, but it has also signaled a readiness to introduce negative interest rates if inflation remains low. This dovish approach has weakened the Swiss franc.
• Swiss Real Retail Sales rose by 2.6% year-over-year in December, exceeding expectations and indicating some strength in the Swiss economy. This could counterbalance recent CHF depreciation.
• The Swiss government’s projected budget deficit of three billion francs annually signals potential economic hurdles that could affect the Swiss franc’s relative value versus the USD.

Forecast for the USD/CHF Pair

Considering both technical and fundamental factors, the USD/CHF pair is expected to trade within a range of 0.9050 to 0.9202 soon. A breakout above the nearby mildly declining trendline, currently situated at 0.9202, should trigger further upside momentum for the pair, particularly if economic data and geopolitical activity continue to support a bullish U.S. dollar outlook.

From an Elliott Wave perspective, the current correction phase will likely give way to notable renewed bullish momentum as a sharply rising third of a third wave unfolds. Swissie traders should closely monitor key levels, especially the wave count invalidation level of 0.8373, to adjust their positions accordingly.

USD/CHF Market Seems Poised for an Upside Breakout

Overall, the USD/CHF pair remains in a critical phase, with technical indicators, including trendline and wave analysis and fundamental data aligning to suggest substantial potential upside movement contingent on a major nearby trendline break occurring. 

Swissie traders should pay close attention to resistance levels around 0.9180 and 0.9202 and any economic data releases that could impact central bank monetary policy decisions.

For those looking to capitalize on these market movements, premier online forex trading platforms like FOREX.com provide the tools, pricing and insights traders need to effectively operate in the forex market. These include advanced trading tools, real-time market data and competitive dealing spreads. Stay informed and trade wisely to maximize USD/CHF market action in the coming weeks.

The post USD/CHF Forecast by Julie Hawk appeared first on Benzinga. Visit Benzinga to get more great content like this.

The AUD/USD currency pair has captured significant attention among forex traders during recent global economic shifts. The exchange rate between the Australian Dollar (AUD) and the U.S. Dollar (USD) has seen notable fluctuations due to evolving central bank policies, notable economic data releases and recent political events.

In this comprehensive forecast, Benzinga will explore the latest market analysis, technical indicators and fundamentals impacting the AUD/USD pair. Whether you’re a seasoned trader or new to the forex market, understanding these dynamics is vital for making informed trading decisions, so let’s get started!

Current Market Analysis

Recent AUD/USD Market Overview

The AUD/USD pair is currently experiencing a rather dynamic market phase after a notable decline seen since the 0.6942 high from Sept. 30, 2024. In the early part of this year, the pair peaked at around 0.6302 on Jan. 6 and then dropped sharply to make a notable low at 0.6131 on Jan. 13 while exhibiting bullish RSI divergence.

The pair’s exchange rate movement has since remained quite volatile within that aforementioned 0.6131-0.6302 exchange rate range, which appears to be an upwardly corrective move with the overall look of a fourth wave. This suggests another low will materialize once the subsequent fifth wave lower commences.

Current market influences include the return of U.S. President Donald Trump’s tariff threats and the potential for an interest-rate cut by the Reserve Bank of Australia (RBA). These elements have contributed to the pair’s recent fluctuation within the 0.6200-0.6300 range.

Factors Influencing the AUD/USD Market

Several key factors are presently influencing the AUD/USD market. These include:

• Trade Policy: U.S. President Donald Trump’s recent threats to impose new tariffs on Chinese goods can affect Australia significantly due to its trade dependency on China.
• Central Bank Policies: With the RBA potentially easing interest rates from February onward, this dovish stance could further negatively impact the AUD’s exchange rate versus the USD.
• Economic Data: Reports from the U.S. and Australia, including U.S. Purchasing Manager’s Index (PMI) data and Australia’s latest jobs report, have played vital roles in shaping the currency pair’s direction. The S&P Global U.S. Manufacturing PMI index recently fell to 49.4 in December 2024 from 49.7 in the previous month. Australia’s latest jobs report shows the unemployment rate remaining at 4.0% in December 2024, with employment increasing to 14,573,800.

Technical Analysis

Now, let’s take a closer look at the technical analysis picture for AUD/USD. A daily chart for the pair’s exchange rate appears below.

Support and Resistance Levels

The AUD/USD pair shows notable support at around 0.6131, while resistance sits near 0.6302. A break above the resistance level could see the pair aim for the 0.6340 mark and eventually eye the 0.6400 level.

On the other hand, if the pair fails to hold the support level at 0.6131, that breakdown event might push the pair lower toward the round-number support point at 0.6100 and potentially even down to the April 2020 low of 0.5990 as the 5th and final wave of the overall decline progresses.

Technical Indicators

• Moving Averages: The AUD/USD pair is currently hovering just below its 50-period Simple Moving Average (SMA), which is declining and situated near 0.6324. The 100-day SMA slows lower at 0.6512, suggesting an upside correction within an overall falling trend.
• Relative Strength Index (RSI): In early January, the 14-day RSI showed a higher low while the pair made lower lows, indicating waning downside momentum and demonstrating potential bullish divergence for the pair. This could signal a near-term upside reversal that has the appearance of a fourth wave.
• Trend Lines: The pair’s movement is slightly upward, but with potential resistance nearby, it could face notable hurdles above the 0.6349 level, the major low point seen on Aug. 5, 2024.

Fundamental Analysis

The economic and geopolitical fundamentals of Australia and the United States influence the market behavior seen in the AUD/USD pair. These factors include:

Economic Indicators

• GDP Growth: Australia’s GDP growth rate can significantly affect the AUD as it indicates economic health and productivity.
• Inflation Rates: Both Australia and the U.S. have shown varied inflation rates. The US’s most recent inflation report showcased a slight rise while Australia’s headline Consumer Price Index (CPI) fell in Q3 2024.
• Interest Rates: The RBA and the Federal Reserve’s interest rate movements weigh heavily on the currency’s direction. The RBA’s potential easing trajectory might lead to a weaker AUD in the near and longer terms.

Political and Global Factors

• Trade Relations: Ongoing trade dynamics, especially those focused on the return of U.S. President Donald Trump’s tariff threats, can weigh heavily on the AUD/USD pair, especially when China is involved.
• Economic Health of Trading Partners: China’s economic condition, as Australia’s largest trading partner, directly influences the relative strength of the AUD. Recent reports have indicated some modest improvements in China’s economy.

Forecast for the AUD/USD Pair

Short-Term Scenario

The AUD/USD may swing between 0.6200 and 0.6300 in the short term. A break above the upper resistance level could push the exchange rate significantly higher, but upside challenges for the AUD still persist, given the risk of potential interest rate cuts from the RBA.

Long-Term Scenario

Long-term projections suggest a cautious approach to this currency pair. If the RBA implements further rate cuts and Trump’s tariffs materialize, the AUD may see further downside versus the USD, potentially taking the pair downward toward the psychological 0.6000 mark. Conversely, positive economic developments in China and stable U.S. economic policies could provide some support for a rebound.

Corrective Upside Then Lower Looks Probable for AUD/USD

Overall, the most probable AUD/USD forecast in the short term suggests the pair will continue experiencing corrective upside movements within the 0.6200-0.6300 range. However, potential future interest rate cuts by the RBA and geopolitical uncertainties, including the specter of the U.S. imposing trade tariffs against China, may limit further gains for the pair and prompt further downside movement in the longer term.

To trade the volatile but potentially profitable AUD/USD market, keeping up to date with the latest market analysis and trends is key. Understanding the technical and fundamental factors involved in exchange rate movements can help you make better trading decisions.

Suppose you’re ready to take the plunge into forex trading. In that case, you can sign up today with FOREX.com, a premier trading partner that truly stands out among online forex brokers, to get reliable access to advanced trading tools, real-time market data and competitive dealing spreads. These features let forex traders approach trading the AUD/USD pair with increased confidence and help them maximize their profit potential.

The post AUD/USD Forecast by Julie Hawk appeared first on Benzinga. Visit Benzinga to get more great content like this.