NZD/USD Price Analysis: Follow-up bounce as bulls defend weekly lows at 0.6150
- Investors should brace for a volatility contraction on Falling Wedge formation.
- The kiwi bulls have defended the weekly lows at 0.6146 for the second time.
- The antipodean is struggling to surpass the 20-period EMA at 0.6253.
The NZD/USD pair is oscillating in a narrow range of 0.6139-0.6158 in the Asian session. The kiwi bulls have defended the weekly lows at 0.6146 for the second time on Wednesday. Broadly, the asset has turned sideways and may display a volatility expansion on the availability of a potential trigger.
On an hourly scale, the formation of the Falling Wedge is indicating a lackluster performance by the major going forward. The upper portion of the chart pattern is placed from June 16 high at 0.6396 while the lower portion is plotted from June 14 low at 0.6196. Usually, the above-mentioned chart pattern leads to a bullish reversal after the upside break of the upper portion of the former.
The downward-sloping trendline placed from Monday’s high at 0.6253 will act as a major hurdle for the counter.
The antipodean is struggling to surpass the 20-period Exponential Moving Average (EMA) at 0.6156, which signals that the short-term trend is still not lucrative for the kiwi bulls.
Meanwhile, the Relative Strength Index (RSI) (14) is focusing surviving the attacks and holding the 40.00 mark to keep bulls alive.
A decisive move above Wednesday’s high at 0.6176 will drive the asset towards the round-level resistance at 0.6200, followed by June 22 low at 0.6244.
On the flip side, the greenback bulls could regain control if the major drop below Tuesday’s low at 0.6124. An occurrence of the same will drag the asset towards 25 May 2020 low at 0.6084. A violation of 0.6084 will expose the asset to more downside potential towards the psychological support of 0.6000.
NZD/USD hourly chart
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Author
Sagar Dua
FXStreet
Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.
