NZDUSD is facing downside pressure today as it moves below the center of the upward trending regression channel that it’s been trading in since January. The negative momentum in the near term is supported by the RSI which has fallen to just below 50. However, the %K line of the stochastic oscillator has fallen more rapidly, entering oversold territory. This suggests that prices may soon consolidate or reverse upwards.
The nearest support is the 0.71 level followed by the 0.7070 area, which was today’s intra-day low. Below that, the 0.6990-0.70 area comes in focus, which was a previous support level and is also where the 50-day moving average is converging. A drop below the 50-day moving average would risk shifting the medium-term outlook from positive to neutral.
An upward reversal could see prices meeting resistance at the 0.72 level, while in order to maintain the current uptrend, the pair needs to challenge the one-year high of 0.7324 set on July 12.
Origin: XM
