NZDUSD plunged to a new 28-month low of 0.5985 during yesterday’s session after it found strong resistance near the 20-day simple moving average (SMA). The price is holding well below the Ichimoku cloud as well as the short- and long-term descending trend lines.
Technically, the MACD oscillator has dived beneath its trigger line in the negative region, while the stochastic is approaching the 20 level following the bearish crossover within its %K and %D lines.
As the price falls beneath the 0.6000 psychological level, the next support to have in mind is the 0.5920 barrier, taken from the bottoms in May 2020. Even lower, the market may meet the trough at 0.5468, registered in March 2020.
On the flipside, if there is a successful climb beyond the 0.6000 mark, the price may run towards the 20-day SMA at 0.6117 ahead of the 0.6155 barrier. Above that, traders may turn their focus on the 40-day SMA at 0.6210, which overlaps with the lower boundary of the cloud and the blue Kijun-sen line. Higher up, the short-term downtrend line at 0.6320 may halt the bullish actions.
All in all, NZDUSD has been developing within a descending move since April 5, and only an advance above the long-term diagonal line may change this outlook.
