**AUD/USD and NZD/USD Gain Momentum as Robust Risk Appetite Emerges**
*Adapted from original analysis by ActionForex*
## Introduction
The foreign exchange market has recently observed a significant advance in the Australian dollar (AUD) and the New Zealand dollar (NZD) in their pairs against the US dollar (USD). Growing optimism about global economic recovery and increased appetite for risk among investors have been central to these gains. This article explores the technical and fundamental drivers of AUD/USD and NZD/USD, analyzes their current movements, and assesses what traders can expect moving forward.
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## Overview of Current Market Sentiment
Currency traders have increased their exposure to risk assets such as AUD and NZD as market sentiment shifts towards optimism. Several factors underpin this trend:
– **Renewed risk appetite:** Investor confidence has surged, influenced by positive economic data points from global economies and ongoing indications that central banks may ease monetary policy going forward.
– **Improved commodity outlook:** Both Australia and New Zealand benefit from higher commodities prices, especially in areas like metals, agriculture, and dairy.
– **Diminished USD strength:** Recent data suggests a cooling US economy and expectations of Federal Reserve interest rate cuts, stalling the US dollar’s consistent gains seen earlier this year.
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## Technical Analysis: AUD/USD
### Recent Performance
AUD/USD has risen significantly in recent sessions as buyers steadily accumulate positions. The pair broke above important resistance levels, indicating bullish momentum and opening the door for further advances.
#### Key Technical Points
– **Near-term support and resistance:**
– The pair recently cleared the 0.6700 resistance, which now acts as a pivotal support level. This breakout is typically interpreted as a sign of further bullish continuation.
– Immediate resistance is near 0.6750, with a potential target towards 0.6800 if the current uptrend persists.
– **Moving averages:**
– Daily charts show AUD/USD holding above the 50-period and 200-period moving averages, supporting the view that near-term direction remains higher.
– **Momentum indicators:**
– The Relative Strength Index (RSI) approaches, but does not exceed, overbought levels, suggesting solid but not excessive buying interest.
### Potential Scenarios
– **Upside case:** A confirmed hold above 0.6700, followed by aggressive buying, could accelerate gains toward 0.6800 and possibly up to 0.6870, a key swing high from earlier in the year.
– **Downside risk:** Failure to maintain support at 0.6700 may prompt short-term profit-taking, with next support near 0.6640 and a major floor at 0.6600.
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## Technical Analysis: NZD/USD
### Recent Performance
The New Zealand dollar has shown similar strength to the Australian dollar, reflecting both external factors and supportive domestic data. NZD/USD has enjoyed a robust rally, mirroring advances in global risk assets.
Read more on AUD/USD trading.