- NZD/USD struggled to capitalize on the overnight bounce from three-week lows.
- Bearish bias remains amid the recent break below the 0.60 confluence support.
The NZD/USD pair traded with a mild negative bias on Friday and remained well within the striking distance of three-week lows set in the previous session. Bulls seemed rather unimpressed by some renewed USD selling bias, albeit signs of stability in the global equity markets extended some support to the pair and might help limit losses, at least for the time being.
Meanwhile, the overnight modest bounce lacked any follow-through and met with some fresh supply near an important confluence support breakpoint, around the 0.6000-0.6010 region. The mentioned support-turned-resistance comprises of 50-day SMA and the lower end of a multi-week-old ascending trend-channel, which should now act as a key pivotal point for short-term traders.
Technical indicators on the daily chart have just started drifting into the bearish territory – though lacked any strong momentum – and add credence to the near-term bearish below the key 0.60 psychological mark. Hence, an extension of the recent downward trajectory, further towards testing the 0.5910-0.5900 support zone, now looks a distinct possibility.
Some follow-through selling below the 0.5900 mark has the potential to drag the pair further towards its next major support near the 0.5850-45 region, or April monthly swing lows.
Conversely, a sustained recovery beyond the 0.6000-0.6010 region might prompt some short-covering move and lift the pair further towards the 0.6070-75 resistance zone. However, any subsequent move up is likely to confront a stiff resistance and remain capped near the 0.6100 round-figure mark.
NZD/USD daily chat
Technical levels to watch