NZD/USD Price Analysis: Pullback moves prod 0.6200 ahead of China Caixin PMI
- NZD/USD takes offers to snap two-day uptrend, reverses from the highest levels in three weeks.
- Weekly support line, one-month-old previous resistance line restrict immediate downside.
- Failure to cross 50% Fibonacci retracement, looming bear cross on MACD favor Kiwi sellers.
NZD/USD takes offers to refresh intraday low near 0.6210 as it reverses the Fed-inspired gains during early Thursday amid a risk-off mood, as well as due to the anxiety ahead of China Caixin Manufacturing PMI for April.
Technically, the Kiwi pair’s inability to cross the 50% Fibonacci retracement of its April 05-26 downside, near 0.6250, joins an impending bear cross on the MACD indicator to lure the sellers.
Adding strength to the bearish bias could be the recent downside break of the 200-SMA, around 0.6215 at the latest.
With this, the Kiwi pair is all set to drop toward the weekly support line of near 0.6200. However, the resistance-turned-support line from early April, near 0.6175 by the press time, could restrict the NZD/USD pair’s further downside.
Should the quote remains weak past 0.6175, the odds of witnessing a fall toward the previous monthly low, also the Year-To-Date (YTD) bottom, near 0.6110 can’t be ruled out.
On the contrary, recovery moves may initially aim for the 200-SMA level of around 0.6215 before challenging the 50% Fibonacci retracement and the recent swing high, respectively near 0.6250 and 0.6260.
Following that, the 61.8% Fibonacci retracement, also known as the golden ratio, of near 0.6280 will precede the 0.6300 round figure and mid-April swing high of 0.6316 to prod the NZD/USD bulls.
To sum up, NZD/USD slips to the bear’s radar but the downside room appears limited.
NZD/USD: Four-hour chart
Trend: Further downside 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.
