NZD/USD Price Analysis: Corrective pullback needs validation from 0.6300 to sustain
- NZD/USD pauses seven-day downtrend near the monthly low.
- Nearly oversold RSI seems to underpin recovery moves but previous support from early May challenges rebound.
- 20-DMA, descending resistance line from April adds to the upside filters.
- Bearish MACD, key support break favor sellers eyeing 61.8% FE.
NZD/USD portrays a corrective pullback around a one-month low, snapping a seven-day downtrend, during Tuesday’s inactive Asian session. The kiwi pair refreshed the monthly low to 0.6246 before recently bouncing off to 0.6270.
The recovery moves seem to take clues from the nearly oversold RSI (14) line. However, the pair remains below the previous horizontal support line from May 10, broken the previous day, which in turn joins the bearish MACD signal to keep sellers hopeful.
Even if the quote rises past the 0.6300 immediate hurdle, the 20-DMA near 0.6442 and a 2.5-month-old downward sloping resistance line, near 0.6480, will be crucial for NZD/USD buyer’s return.
Also acting as an upside filter is the monthly high near 0.6580.
Alternatively, fresh declines could be aimed for the yearly low surrounding 0.6215 and may again portray indecision near the 0.6200 threshold.
It’s worth noting that multiple lows marked during March and April of 2020 could also challenge NZD/USD near around 0.6150 before directing them to the 61.8% Fibonacci Expansion (FE) of April-May moves, near 0.6070-65.
NZD/USD: Daily chart
Trend: Further weakness expected
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
