NZD/USD Price Analysis: Kiwi plunges, outlook hinges on SMA convergence support
|- On Wednesday, NZD/USD dives further, approaching 100 and 200-day Simple SMA convergence.
- The Kiwi's outlook could skew bearish as the pair nears losing the significant 0.6070 threshold.
On Wednesday, the NZD/USD took a big hit, with the pair plunging towards the convergence of the 100 and 200-day Simple Moving Averages (SMAs) near the 0.6070 level. Pressure mounts on the pair and further losses could be on the horizon if the bears fail to defend this crucial area.
The Relative Strength Index (RSI) for the NZD/USD pair on the daily chart plummeted to 42, suggesting a deepening bearish momentum. Even though it hasn't reached the oversold threshold yet, the declining trend is visible. The Moving Average Convergence Divergence (MACD) indicates bearish sentiment with rising red bars, affirming the stronger position of the sellers.
NZD/USD daily chart
The NZD/USD finds immediate support near the 0.6070 threshold coinciding with the converging 100 and 200-day SMAs. Additional support is lurking lower at 0.6050. A breakdown below these SMAs would validate a deeper sell-off scenario.
On the flip side, resistance is now at the former support level of 0.6100. The 20-day SMA at 0.6145 offers additional resistance, followed by resistance points at 0.6170 and 0.6200. A decisive breakout above these levels could signal a termination of the current bearish trend and a shift in favor of the bulls.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.