NZD/USD Price Analysis: Fades bounce off 200-SMA below 0.6390 resistance confluence
- NZD/USD struggles to defend weekly gains despite keeping recent technical breakouts.
- Convergence of weekly resistance line, 61.8% Fibonacci retracement level guards immediate upside amid bearish MACD signals.
- Sustained trading beyond 200-SMA, previous resistance line from early December keeps buyers hopeful.
NZD/USD retreats to 0.6370 as bulls take a breather ahead of the key inflation data from China and the US on early Thursday.
In doing so, the Kiwi pair fades the previous day’s bounce off the 200-Simple Moving Average (SMA). Also adding strength to the pullback moves could be the bearish MACD signals.
Even so, the NZD/USD buyers defend Friday’s upside break of the one-month-old descending resistance line, now support, as well as the 200-SMA. On the same line is the firmer RSI (14) line, not overbought.
Hence, the NZD/USD price is likely to struggle despite keeping the latest bullish signals.
That said, a convergence of the weekly descending trend line joins the 61.8% Fibonacci retracement level of the pair’s December-January downturn, around 0.6390, appears a tough nut to crack for the NZD/USD bulls.
Following that, the monthly high around 0.6415 appears additional upside filter for the quote to cross to justify the traders’ bullish bias.
In a case where the NZD/USD remains firmer past 0.6415, the odds of witnessing a run-up toward the previous monthly peak of 0.6514 can’t be ruled out.
Meanwhile, the 200-SMA and the aforementioned resistance-turned-support line, close to 0.6335 and 0.6295 in that order, restrict the short-term downside of the NZD/USD pair.
If the Kiwi pair sellers keep the reins past 0.6295, the recent hopes of witnessing a north-run take a backseat as prices could challenge the monthly low of 0.6190.
NZD/USD: Four-hour chart
Trend: Pullback expected
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.