NZD/USD Price Analysis: Refreshes weekly low below 0.6450 on consolidation breakdown

• NZD/USD has refreshed its weekly low around 0.6440 amid negative market sentiment.
• The Kiwi asset has delivered a breakdown of the consolidation and a Rising Wedge pattern.
• A slippage of the RSI (14) into the 20.00-40.00 range has weakened the New Zealand Dollar.

The NZD/USD pair has printed a fresh weekly low at 0.6440 in the Asian session as investors’ risk-taking ability has faded dramatically. The Kiwi asset has been dumped by the market participants as the US Dollar Index (DXY) is advancing vertically.

The risk aversion theme is impacting risk-sensitive assets like S&P500 futures, which have surrendered their entire gains recorded in Asia and have resumed their downside journey. Volatility in the market has accelerated ahead of the interest rate decision by the Federal Reserve (Fed).

NZD/USD has delivered a downside break of the consolidation formed in a range of 0.6451-0.6515 on a four-hour scale, which indicates a volatility explosion that set grounds for wider ticks and heavy volume. The asset has also delivered a breakdown of the Rising Wedge chart pattern, which indicates a bearish reversal.

The Kiwi asset has also surrendered the 23.6% Fibonacci retracement support (placed from January 6 low at 0.6190 to January 18 high at 0.6531) at 0.6450.

Also, the Relative Strength Index (RSI) (14) has shifted into the bearish range of 20.00-40.00, which indicates more downside ahead.

Going forward, a breakdown below January 16 high at 0.6426 will drag the Kiwi asset toward January 17 low at 0.6366 followed by January 12 low around 0.6300.

On the flip side, the asset needs to surpass Wednesday’s high at 0.6530 for a resumption in the upside, which will drive the asset toward June 3 high at 0.6576. A breach of the latter will expose the asset to the round-level resistance at 0.6600.

NZD/USD four-hour chart

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.