NZDUSD is hovering at 4-month highs close to the key 0.7300 level. After extending a rally to 0.7330 on Wednesday, the market took a breather and is consolidating gains. The uptrend from December remains intact and NZDUSD maintains a bullish bias, with scope for another leg higher.
NZDUSD is currently testing the 0.7300 level and focus is on the upside for a re-test of Wednesday’s high of 0.7330. A break from here could confirm that another leg up is underway with scope to reach the next handle at 0.7400.
Failure to make a sustained move above 0.7300 in the near term could see prices drift to the downside to minor support at the 50-period moving average and yesterday’s low of 0.7234. A drop below 0.7200 would suggest a short-term top is in place at 0.7330 and the bias would shift to a more bearish one.
Overall, the bullish outlook remains in place with the market’s focus on re-testing Wednesday’s high of 0.7330. Looking at the 4-hour chart, the moving averages (50 SMA and 200 SMA) are bullishly aligned and rising. The RSI is above 50. However, overbought conditions on the daily chart (RSI above 70) suggest that NZDUSD could pause at current levels for now.
