NZD/USD reached overbought levels according to the RSI and found strong resistance just after touching a four-month high of 0.6580.  Also, the MACD is holding above its red trigger line, which supports the bullish view, while the 20-day simple moving average (SMA) keeps increasing its distance above the 40-day SMA, suggesting that the recent upward move is likely to stay in place for now.

In case the pair maintains its upward trajectory, the bulls could challenge the next resistance at 0.6665, taken from the minor peak on January 16, before hitting the December’s high of 0.6750.

Alternatively, a downside correction may drive the price towards the 0.6445 support, a break of which could shift the spotlight towards the flat red Tenkan-sen line at 0.6370 and the 200-day SMA currently at 0.6310. Beneath the latter, the 20-day SMA at 0.6246, which overlaps with the blue Kijun-sen line and the 0.6175 support level, could come into view.

Summarising, NZD/USD maintains a bullish bias in the short-term picture after the bounce off 0.5467 on March 19, whereas in the medium- and long-term timeframe it holds a bearish profile.

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This information is not considered as investment advice or investment recommendation but instead a marketing communication. This material has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.

Source: XM