Pound-to-New Zealand Dollar Week Ahead Forecast: Buying at the 200-day EMA

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The pound to New Zealand dollar exchange rate (GBP/NZD) starts the new week attempting to stabilise after last week’s sharp sell-off, with the pair edging higher to 2.2972 on Monday.

The early rebound has lifted GBP/NZD back above its 200-day exponential moving average, currently situated near 2.2860, a level that had been threatening to give way late last week.

A confirmed break below the 200-day EMA would have marked a decisive shift from a medium-term bullish to a medium-term bearish trend, placing the pair at risk of deeper losses. For now, however, the level appears to have arrested the decline and may yet attract dip buyers.

The technical case for stabilisation is reinforced by the proximity of horizontal chart support around 2.28, an area that has previously acted as a demand zone.

Momentum indicators also argue against immediate follow-through to the downside. The recent sell-off drove the Relative Strength Index down to 30, a threshold widely associated with oversold conditions.

At such levels, RSI tends to mean-revert, implying either a corrective bounce or a period of consolidation rather than a continuation of the decline. This suggests recent weakness in GBP/NZD may be more technical than fundamental in nature.

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Positioning dynamics appear to have played a central role in driving the New Zealand dollar’s strength over recent days. The move higher in NZD reflects a significant washout of short positions that had accumulated heading into 2026.

The kiwi entered the year carrying one of the largest speculative short overhangs in the G10 complex, leaving it vulnerable to sharp counter-trend moves once sentiment turned.

“At the extremes, positioning matters,” says Richard Cochinos, FX Strategist at RBC Capital. “This is most obvious in NZD currently.”

Historical episodes underline the scale of such adjustments. In 2019, a comparable short unwind saw the New Zealand dollar appreciate by roughly 8%, while the 2025 correction delivered gains of around 9.4%.

Looking ahead, the balance of risks suggests GBP/NZD may spend the week consolidating above the 200-day EMA rather than resuming an aggressive decline, provided the 2.28 support region continues to hold.

With positioning now likely being cleaner and momentum having reset, further NZD gains may require fresh fundamental catalysts rather than continued technical unwinding, leaving the pair vulnerable to choppier, two-way trade in the near term.

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