NZD/USD continued tumbling on Friday, breaking below the 0.6325 support (now turned into resistance) barrier, marked by the low of November 12th. Overall, the pair has been printing lower highs and lower lows below a tentative downtrend line drawn from the high of December 31st, which keeps the near-term picture negative. However, bearing in mind that the rate found some support near the return line taken from the low of January 3rd, we would stay careful of a possible corrective bounce before the bears decide to shoot again.

A clear break back above 0.6325 may confirm the case for a small bounce and may allow the recovery to continue towards the 0.6360 or 0.6380 levels, defined as resistance by the inside swing lows of November 14th and February 11th respectively. The bears may regain control from near those levels and may pull the trigger targeting the low of October 17th, at around 0.6285. If they are not willing to hit the brakes near that barrier either, we could see them aiming for the return line again, or the low of October 16th, at around 0.6240.

Taking a look at our short-term oscillators, we see that the RSI lies below 30, but turned up today, while the MACD, although below both its zero and trigger lines, shows signs of slowing down. It could also bottom soon. Both indicators suggest that the strong downside speed may start decelerating and support our view for a small bounce before the next negative leg.

In order to start examining the case for a somewhat larger correction, we would like to see a strong move above 0.6380. Such a move may pave the way towards the 0.6420 zone, the break of which may target the downtrend line taken from the high of December 31st. That said, we would still see decent chances from the bears to jump back in from near that line. In order to totally abandon the bearish case, we would like to see a clear close above 0.6450.

NZDUSD

 


 

JFDBANK.com - One-stop Multi-asset Experience for Trading and Investment Services

 


The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. JFD Group, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD Group analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyses and must therefore be viewed by the reader as marketing information. JFD Group prohibits the duplication or publication without explicit approval.

76% of the retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. Please read the full Risk Disclosure: https://www.jfdbank.com/en/legal/risk-disclosure

Analysis feed

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!


Latest Forex Analysis

Editors’ Picks

AUD/USD remains under pressure below 0.6100 as markets stay defensive

AUD/USD fails to cheer better than forecast activity numbers from home and China. Globally rising coronavirus cases, extended lockdowns in Europe and grim words from key policymakers favor risk-off. 

AUD/USD News

USD/JPY seesaws around 107.00 amid coronavirus-led risk-off

USD/JPY remains on the back foot amid the early Thursday morning in Asia. The Japanese yen benefits from its safe-haven allure while being the only major to gain versus the US dollar during the current tough time.

USD/JPY News

Gold building a bullish case as COVID-19 reigns

The gold price has lost some bullish support of late as the US dollar moves higher, ending the last quarter on the front foot as a relatively illiquid market sees exaggerated moves adding to the upside support. 

Gold News

WTI pierces $21.00 as US fuels hopes of supply disturbance/control

While extending its recovery moves from the previous day, WTI clears the $21.00 mark, with a high of $21.20, while taking rounds to $21.10 during Thursday’s Asian session. The US leader expects Russia-Saudi Arabia “to work it out.”

Oil News

Dollar Shrugs Off ISM & ADP in Fear of Ugly Jobless Claims

If the first day of April is a taste of what's to come, it will be a very rocky second quarter. After falling more than 24% between January and March, the Dow Jones Industrial Average plunged opened down more than -700 points. 

Read more

Forex Majors

Cryptocurrencies

Signatures