- NZD/USD holds lower ground after ticking down to the yearly low during three-day fall.
- Descending trend line from March can test bears amid oversold RSI trend.
- 10-DMA, five-week-old resistance line to restrict corrective pullback.
NZD/USD bounces off an intraday low of 0.6732, also the yearly bottom, to consolidate the daily losses around 0.6745 during Wednesday’s Asian session.
The kiwi pair remains on the back foot ever since it failed to overcome the 10-DMA hurdle the last Thursday. Also portraying the bearish bias is the descending trend line from early November, as well as sluggish MACD signals.
It should be noted, however, that a nine-month-old support line near 0.6700 will challenge the NZD/USD bears as the RSI line tests oversold territory.
If not, then a downward trajectory towards late 2020 bottom near 0.6590 can’t be ruled out.
Alternatively, a successful run-up beyond the stated resistance line and 10-DMA joint surrounding 0.6785 will direct the Kiwi pair buyers to a horizontal area from late September near 0.6860-70 and then to multiple levels marked in the last 11 weeks, close to 0.6980.
Adding to the upside filters is the 0.7000 threshold that acts as a validation point for the NZD/USD bull’s return.
NZD/USD: Daily chart
Trend: Further weakness expected