NZDUSD surged to a new 32-month high of 0.7072 earlier today, continuing the buying interest that started after the pullback off the 0.5470 support level.
The price is developing well above the ascending trend line and the 20- and 40-day simple moving averages (SMAs). The MACD seems to be gaining momentum above its trigger line, while the RSI is still hovering around its 70 overbought mark, signaling more cautious trading in the short-term.
The pair needs to overcome today’s peak to meet the 0.7160 resistance level, identified by the inside swing low from March 2018 before a more important battle starts near the 0.7395 barrier, taken from April 2018.
However, should the price fall below the 0.7060 mark, support could be initially detected within the inside swing high from December 2018 at 0.6970 and the 20-day SMA at 0.6923. Clearing that zone, the next stop could be around the ascending trend line at 0.6860, while further declines could hit the 0.6800 handle. Below that, the market could turn to neutral, resting around the 23.6% Fibonacci retracement level of the up leg from 0.5470 to 0.7079 at 0.6690.
In the long- and short-term timeframes, the sentiment remains strongly bullish. Only a tumble below the 200-day SMA around the 38.2% Fibonacci of 0.6460 may shift this outlook to slightly bearish.
Origin: XM
