NZDUSD has declined considerably in recent weeks, falling to a five-and-a-half-month low of 0.6817 during Friday’s trading.
The Tenkan-sen line being below the Kijun-sen line is a negative alignment pointing to bearish momentum in the short-term. Adding to this, both lines maintain a fairly steep negative slope.
Should the pair continue declining, the area around Friday’s low of 0.6817 could act as support. Notice that the area around this level also encapsulates the May 11 seventeen-month low (which is only marginally below last week’s low).
If NZDUSD reverses course and heads higher, the range around 0.69 might provide resistance – 0.69 being a potential psychological level.
The medium-term picture based on movement over the last five months is looking bearish with the overall trend throughout this period being negative. In addition, the pair has been recording lower lows and lower highs ever since reaching a twenty-nine-and-a-half-month high of 0.7558 on July 27. Furthermore, NZDUSD is trading below the Ichimoku cloud as well as below the 50- and 100-day SMAs (simple moving averages) with the two recording a bearish cross earlier in October when the 50-day SMA moved below the 100-day one.
Overall, the pair is looking bearish in both the short- and medium-term.
