NZD/USD Price Analysis: Pair weakens as it nears 20-day SMA
- NZD/USD eases to 0.5655 on Thursday, extending its pullback from recent highs.
- The pair is approaching the 20-day SMA, a key level that may determine its next move if breached.
- Technical indicators signal increasing bearish pressure, with RSI declining sharply and MACD showing weakening momentum.
The NZD/USD pair continued its downward drift on Thursday, edging lower to 0.5630 as selling pressure persisted. The pair has been consolidating after failing to maintain its previous upward momentum, and its approach toward the 20-day Simple Moving Average (SMA) could act as a pivotal point for traders. A break below this level may reinforce the bearish outlook, while a bounce could offer short-term support.
Technical indicators suggest growing downside risks. The Relative Strength Index (RSI) has dropped to 46, declining sharply and remaining in negative territory, indicating waning buying interest. Meanwhile, the Moving Average Convergence Divergence (MACD) histogram prints decreasing green bars, suggesting a loss of bullish momentum and a shift in favor of sellers.
Looking ahead, the 20-day SMA near 0.5630 stands as immediate support. A decisive move below this level could open the door for a decline toward 0.5600, while on the upside, resistance is seen at 0.5685, followed by the psychological barrier at 0.5700. Until the pair clears key resistance levels, downside risks remain dominant.
NZD/USD daily chart
Author
Patricio Martín
FXStreet
Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.
