Technical Analysis – NZDUSD battles with 200-day SMA
July 27, 2023 9:26 pm
NZDUSD had been steadily gaining ground after finding its feet at the 2023 low of 0.5984, storming to a fresh 2023 peak of 0.6410 in mid-July. However, the pair quickly retraced lower, with the price bouncing off the 50-day simple moving average (SMA) before attempting to surpass the 200-day SMA.
The momentum indicators currently suggest that bearish forces are in control. Specifically, the RSI dropped below its 50-neutral mark, while the MACD is softening below its red signal line in the positive zone.
If the selling interest intensifies, the pair could descend towards the recent support of 0.6162, which coincides with the 50-day SMA. A drop beneath that region could trigger a retreat towards the March bottom of 0.6083 before 0.6049 gets tested. Even lower, the 2023 low of 0.5984 could prove to be a tough obstacle for the price to overcome.
On the flipside, should the correction cease and the price edge back higher, initial resistance could be met at the April peak of 0.6323. Conquering this barricade, the bulls could aim for the May high of 0.6383 before the 2023 peak of 0.6410 appears on the radar.
Overall, NZDUSD experienced a strong pullback in the short term, but the technical picture seems to be improving after the 50-day SMA curbed further declines. However, a failure to reclaim the 200-day SMA could lead to another round of downside pressure for the pair.
NZDUSD had been steadily gaining ground after finding its feet at the 2023 low of 0.5984, storming to a fresh 2023 peak of 0.6410 in mid-July. However, the pair quickly retraced lower, with the price bouncing off the 50-day simple moving average (SMA) before attempting to surpass the 200-day SMA.
The momentum indicators currently suggest that bearish forces are in control. Specifically, the RSI dropped below its 50-neutral mark, while the MACD is softening below its red signal line in the positive zone.
If the selling interest intensifies, the pair could descend towards the recent support of 0.6162, which coincides with the 50-day SMA. A drop beneath that region could trigger a retreat towards the March bottom of 0.6083 before 0.6049 gets tested. Even lower, the 2023 low of 0.5984 could prove to be a tough obstacle for the price to overcome.
On the flipside, should the correction cease and the price edge back higher, initial resistance could be met at the April peak of 0.6323. Conquering this barricade, the bulls could aim for the May high of 0.6383 before the 2023 peak of 0.6410 appears on the radar.
Overall, NZDUSD experienced a strong pullback in the short term, but the technical picture seems to be improving after the 50-day SMA curbed further declines. However, a failure to reclaim the 200-day SMA could lead to another round of downside pressure for the pair.
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