March 2025 Price Action Review
The Fed kept interest rates unchanged at 3.50%–3.75%. Chair Jerome Powell said the Fed is not in a hurry to cut rates, citing inflation risks linked to energy prices. US Initial Jobless Claims fell to 205K in the week ending 14 March. This was below expectations of 215K and the previous 213K. On the 4-hour chart, the pair traded at 0.5873 above the 20-period SMA near 0.5840, but below the falling 100-period SMA around 0.5902. The RSI rose to 58 after rebounding from below 40. Support levels are 0.5872, 0.5830 and 0.5798, while resistance is at 0.5892 and around 0.5902. The technical analysis section was produced with help from an AI tool.March 2026 Market Backdrop
We are looking back at the price action from this time in March 2025, where the NZD/USD pair rallied despite weak New Zealand GDP data. The move was a clear reminder that broad US Dollar sentiment can overpower local fundamentals. We saw the pair push higher even as the Federal Reserve signaled it was in no rush to cut rates. Fast forward to today, March 20, 2026, the situation has evolved, yet the lesson remains critical. Recent data shows New Zealand’s quarterly CPI has held firmer than expected at 3.1%, keeping the Reserve Bank of New Zealand on alert. Meanwhile, the Fed’s latest dot plot this week signaled a willingness to begin easing, a notable shift from the hawkish stance we observed last year. Given what we saw in 2025, we should be wary of assuming a straightforward rally in the kiwi, even with a more supportive fundamental backdrop. Last year’s surprise USD weakness shows that positioning can be a powerful driver. Therefore, we should consider strategies that offer upside exposure while clearly defining our risk in case sentiment shifts unexpectedly again. A prudent move for the coming weeks would be to look at call options on the NZD/USD. This allows us to participate in a potential move higher, driven by interest rate differentials, without risking significant capital if the broad market turns against the kiwi. Buying the 0.6200 strike calls for April could capture a break above the recent consolidation around the current 0.6150 level. Technically, the pair is currently finding support near the 50-day moving average around 0.6120. A key resistance level to watch is the 0.6190 area, which has capped rallies twice in the last month. A decisive break above this level would signal strengthening momentum, validating the use of long-option strategies. The main takeaway from last year’s price action is that the broader US dollar trend can abruptly change course. We should protect any bullish positions with protective put options or tight stop-losses below the 0.6100 psychological level. This ensures we are not caught on the wrong side of a sudden reversal, similar to the one that surprised traders in March 2025. Create your live VT Markets account and start trading now.
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