NZDUSD is trying to recoup significant losses that were posted in the previous eight days, recording a new 25-month low below the 0.6200 round number.
The 20- and 40-day simple moving averages (SMAs) appear ready to post a bullish crossover in the short-term, while the technical indicators are confirming the recent positive move. The RSI rebounded off the oversold region, and the stochastic oscillator created a positive cross within its %K and %D lines below the 20 level, both suggesting that the aggressive selling interest may end soon.
Immediate resistance to further gains would likely come from the 0.6410 barrier and the short-term SMAs currently at 0.6430. If there is a successful break above this area, further resistance could be met around the 0.6570 barrier and the 0.6725 inside swing low from March 15.
If the upside momentum were to lose steam again and if the pair were to reverse lower, diving below the intraday’s low of 0.6195, then the next target could come from the 0.6170 support, registered in April 2020. Failure to hold above this level, the market would push the market to slip towards the 0.5920 barrier, taken from the low in May 2020.
In the more medium-term picture, the bearish outlook may remain intact and is likely to stay this way as long as prices remain below the short-term SMAs.
