NZD/USD Update

The NZD/USD has seen a small increase for the second consecutive day, trading around 0.5810 during the Asian trading hours on Tuesday. A look at the daily chart indicates that the prices are moving in a sideways pattern, hinting at market consolidation and a somewhat unclear period ahead.

In the short term, there is a bearish sentiment surrounding the NZD/USD pair, as the prices remain below both the 9-day and 50-day exponential moving averages (EMAs). This scenario, where prices linger below these moving averages, suggests a potential sell-off in the bull market. However, the 14-day relative strength index (RSI) hovers around 43, highlighting that while the upward movement is fading, it’s not yet in a fully oversold position.

The initial support for the NZD/USD pair is likely found at the bottom of the rectangle near 0.5790, with additional support around the two-week low of 0.5782 noted on June 8th. If prices dip below this support zone, it may exert further downward pressure, possibly keeping the pair near the six-month low of 0.5681 recorded on April 6th.

Conversely, if the NZD/USD starts climbing, it could aim for a significant barrier at the 9-day EMA around 0.5853, followed by the 50-day EMA at 0.5875. A successful breakout above these moving averages might help the pair reach the upper limit of the rectangle, close to 0.5990, and then the three-month high recorded on February 29th at 0.5995.