NZD/USD Price Analysis: Short-term uptrend hinted, buyers might take some profits
- The daily RSI shows minor buying traction, further validation is needed.
- The hourly chart reveals growing buying momentum with RSI hitting overbought terrain.
- Buyers finally recovered the 20-day SMA, which brightens the outlook for the short term.
The NZD/USD rose to 0.5961, displaying a rally of 0.56% and jumping above the key short-term 20-day Simple Moving Average (SMA) on Thursday which now indicates a potential bullish bias. However, the broader trend remains bearish. With the intense increase in buying traction on an hourly scale, buyers might take some profits ahead of the Asian session.
On the daily chart, the Relative Strength Index (RSI) stands just above negative territory threshold, hinting at a slight uptrend. However, this inconclusive signal requires further validation to be considered a bullish flag.
NZD/USD daily chart
On the hourly chart, the RSI is at 66 slightly down after hitting the overbought threshold. This indicates a stronger short-term buying momentum but that the pair may start to consolidate ahead of Friday’s session. Furthermore, the Moving Average Convergence Divergence (MACD) presents green bars, showing positive momentum.
NZD/USD hourly chart
Considering broader market movements, the NZD/USD’s jump above the 20-day Simple Moving Average (SMA), signify a potential short-term upward trend. However, the pair still lingers below the 100 and 200-day SMA, implying sustained selling pressure and a bearish market bias long-term. That being said, bulls are making arguments to be considered seriously and will start to set their sight at the 100-day SMA at 0.6100.
Author
Patricio Martín
FXStreet
Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.
