NZDUSD has advanced considerably since roughly the beginning of the month, hitting the 0.6780 resistance level again, during Thursday’s European session. The price surpassed the 20- and 40-simple moving averages (SMAs) in the 4-hour chart, while the technical indicators suggest further advances.
Momentum indicators are pointing to a bullish bias in the short term with the RSI above threshold of 50 and the MACD oscillator is rising in the negative territory with strong momentum, indicating a further upside reversal is nearing.
Further gains should see the June 21 bottom of 0.6824 before being able to hit the 38.2% Fibonacci retracement level of the downleg from 0.7060 to 0.6686, around 0.6830. A rise above these strong key levels would reinforce the bullish correction in the short-term and open the way towards the 50.0% Fibonacci mark of 0.6872.
In the event of a downside movement, the 20-SMA near 0.6745 at the time of writing could act as support barrier. A break below this zone would drive the price until the more than two-year low of 0.6686 support.
Overall, NZDUSD seems to be giving back all the losses that it posted in the previous days this week endorsing the scenario for a possible upside retracement.
