NZDUSD could not overcome the key 0.6485 restrictive area last week, reversing south to unlock a three-month low of 0.6344 early on Thursday.
The price is currently approaching a support zone near 0.6325 which could keep the bears busy in the short-term as the oversold status in the RSI and the Stochastics suggest, while the presence of the lower Bollinger band in the neighborhood is also increasing the case.
That said, the bearish cross between the 20- and 200-day simple moving averages (SMAs) is signalling that any stabilization or a rebound could be short-lived and that the downtrend could see further extension if the cross stays intact.
Failure to rebound around 0.6325 may bring new sellers into the market, with support running towards 0.6253, while lower a successful violation of the ten-and-a-half-year low of 0.6202 could prove more harmful as the nearest barrier beneath that is seen around 0.6100. Consequently, such a move would resume the bearish outlook in the bigger picture too.
On the upside, buyers would be eagerly waiting for a closure above 0.6485 and the 200-day SMA in order to get back into the game. In this case, resistance could be next detected somewhere between the 50-day SMA currently at 0.6560 and the upper Bollinger band. Slightly higher, the 0.6625 level may add some pressure as it did in previous sessions.
Summarizing, the negative momentum in NZDUSD is likely to ease in the short-term, though the pair could soon resume its downtrend, with the 0.6325 number expected to trigger the next bearish wave.
