NZD/USD Price Forecast: Approaches 0.5900 resistance area as US Dollar weakens

The New Zealand Dollar (NZD) is on an upward trajectory, approaching the resistance area of 0.5900 as the US Dollar (USD) weakens. This trend follows a decline in hopes for immediate Federal Reserve interest rate hikes, as evidenced by the cooling US CPI and PPI inflation in July, which has reduced the likelihood of a Fed rate hike in September to nearly 30%.

Despite ongoing US-Iran conflict tensions, the weakening USD is keeping risk appetite high, and technical indicators suggest a constructive bias with the Relative Strength Index (RSI) near 59. Bulls are targeting the area between 0.5905 and 0.5920, followed by the 0.6000 level. Should the price fall, initial support is expected at the area between the upward trendline and the 200-day SMA at 0.5831, with further downside potential at the late July lows near 0.5760.

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