NZDUSD has been consolidating since February and has been stuck in a channel tilted slightly to the downside. The neutral to bearish picture in the medium term looks to last for a while longer after prices failed to break above the upper channel in the prior week.
Resistance was met at around the 0.7400 psychological level, which overlaps with the upper boundary after prices hit an almost 2-month high of 0.7395, forcing the pair to reverse lower. In the 4-hour chart, the RSI indicator is flattening below the 50 level, while the MACD oscillator is holding near the trigger line and below the zero line.
Should the pair manage to strengthen its negative momentum, the next support could come around the 0.7300 key level, which is converging with the lower Bollinger band. A break below this level would signal a resumption of the longer-term downtrend and the pair could touch the 0.7240 barrier.
Conversely, if prices are unable to continue the downward movement, the bearish bias could shift to bullish with significant resistance the 0.7342 support, which holds near the mid-level of the Bollinger band (20-simple moving average). An upside break of that zone would open the door for the upper Bollinger boundary around 0.7370.
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