Hopes of a possible agreement between the United States and Iran have sparked a fresh wave of optimism across financial markets, even though Iran has pushed back against claims that a final deal is close.
Former President Donald Trump suggested that a deal could be signed as soon as this weekend, potentially reopening the Strait of Hormuz and easing tensions in the region. Iran responded by saying that no final agreement has been reached and that it will not compromise on its core demands. Despite the uncertainty, traders appear focused on the positive side of the story.
This renewed optimism triggered a strong “risk-on” move in the markets, pushing both the Australian Dollar (AUD) and New Zealand Dollar (NZD) sharply higher. These currencies often perform well when investors are willing to take on more risk, especially during periods of improving market sentiment.
The positive mood is also reflected in equity markets. Futures for major Asian stock indices are climbing strongly, with Japan’s Nikkei up over 3% and South Korea’s KOSPI gaining more than 7% ahead of trading. There’s also excitement around SpaceX preparing to begin trading on the Nasdaq, adding to the upbeat market atmosphere.
Overall, unless there is a major escalation in geopolitical tensions, market sentiment currently favors further gains in risk-sensitive currencies like the Aussie and Kiwi.
AUD/USD Technical Outlook
AUD/USD showed an important bullish reversal on the daily chart after the latest Iran-related headlines. The pair had previously been under heavy selling pressure, breaking several support levels, which makes this rebound more meaningful.
On the upside, the first key resistance area sits near 0.7080, where the 100-day moving average and a longer-term uptrend line are converging. A sustained break above 0.7100 could open the door for a move toward 0.7200 and the 50-day moving average.
On the downside, the 0.7000 level remains a major support zone and has attracted buyers multiple times in recent months. If selling pressure increases again, the next important support area may come between 0.6964 and 0.6956.
Although some momentum indicators still suggest caution and favor selling rallies, the market is currently being driven more by headlines than technical signals.
NZD/USD Technical Outlook
NZD/USD has also posted a bullish reversal, though price action remains choppy due to lower liquidity and rapid news-driven swings. The pair recently tested its 200-day moving average and continues to trade around that level.
If bullish momentum continues, traders will be watching resistance near 0.5847. A break above that level could lead to a stronger rally toward 0.5920 and the 100-day moving average.
On the downside, immediate support is seen near 0.5774. If that level fails, the next major support appears around 0.5762.
Momentum indicators for NZD/USD are mostly neutral, matching the pair’s sideways trading behavior. In the current environment, flexibility and quick reactions may be more important than holding a strong bullish or bearish view.
