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NZD/USD extends late Thursday’s pullback from weekly high inside bearish chart pattern.
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RSI, MACD conditions indicate that buyers are running out of steam while the pullback from the 200-SMA reinforces the negative bias.
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Late January’s swing low adds to the upside filters before welcoming Kiwi buyers.
NZD/USD teases sellers inside a bearish formation as it drops to 0.6320 during the early hours of Friday morning in New Zealand. In doing so, the Kiwi pair extends the late Thursday pullback from the one-week high.
In addition to the weekly bear flag chart pattern, the quote’s inability to cross the 200-SMA also teases the sellers. Furthermore, the receding strength of the bullish MACD signals and the sluggish rise in the RSI adds strength to the downside bias.
However, a clear negative break of the flag’s lower line, noted near 0.6315 by press time, becomes necessary for a theoretical decline towards mid-November 2022 around 0.6065.
That said, monthly lows marked so far during 2023, around 0.6270 and 0.6190, could offer intermediate halts during the anticipated slump between 0.6315 and 0.6065.
Alternatively, the 50% Fibonacci retracement level of the NZD/USD pair’s January-February upside, near 0.6365, could act as an immediate resistance to watch during the recovery.
Following that, the 200-SMA and the stated flag’s top line, respectively near 0.6385 and the 0.6400 threshold, will be crucial to watch as they hold the keys to the NZD/USD bull’s entry.
NZD/USD: Four-hour chart
Trend: Further downside expected
ADDITIONAL IMPORTANT LEVELS
