Technical Analysis – NZDUSD fails to post lower low below 26-month bottom

NZDUSD is trading around the vicinity of 0.6095, that being the 26-month low as the pair failed on its third attempt third attempt to breach this level.

Looking to the short-term oscillators, the MACD and the stochastic are promoting negative momentum. The MACD is strengthening below its trigger and zero lines, while the stochastic posted a bearish cross within its %K and %D lines near the oversold territory.

Should buyers drive above the 0.6195 resistance, they could encounter initial strengthened resistance from the 20-day simple moving average (SMA) at 0.6230 and the medium-term descending trend line around 0.6265. A step above may meet further constrictions from the 40-day SMA at 0.6335 and the 0.6395 resistance, which stands near the Ichimoku cloud.

Otherwise, if sellers take control, initial support could come from the 0.6095 barrier ahead of the 0.5920 trough, taken from the low in May 2020.

All in all, the medium-term timeframe is sustaining a bearish mode for now. However, a break above the downtrend line may open the way for a bullish correction. 

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