Snapshot: NZD/USD is currently trading at 0.5916, up 0.82% on the session, driven by reports suggesting a potential easing of tensions in the Middle East. This optimism is overshadowing higher-than-forecast New Zealand inflation data from last week.
- Watch resistance at 0.5922, today’s high.
- Downside risk comes from the fragility of the Middle East situation; failure of peace talks would likely trigger a swift risk-off move.
Bias into NY: The short-term setup favours further upside for NZD/USD, targeting 0.5950, as long as risk sentiment remains positive. The crowded short positioning also raises the risk of a squeeze.