NZD/USD Technical Analysis: Pullback likely, bearish RSI divergence on 4H
|- NZD/USD's 4-hour chart is reporting a bearish divergence of RSI.
- The daily RSI is signaling overbought conditions for first since November 2018.
NZD/USD risks ending the four-day winning streak, as technical charts are reporting buyer exhaustion.
To start with, the relative strength index on the 4-hour chart has produced lower highs, contradicting the higher highs on NZD/USD. That bearish divergence is widely considered a warning of impending pullback.
Further, the 14-day relative strength index is reporting overbought conditions with an above-50 print for the first time since November 2018. The long upper shadow attached to Thursday's candle is also signaling bullish exhaustion.
All in all, the stage looks set for a corrective pullback to 0.6520 (hourly chart support).
The pair is currently trading in a sideways manner around 0.6545. The Kiwi rose 0.23% on Thursday, confirming the first four-day winning streak since September.
4-hour chart
Trend: Pullback likely
Technical levels
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