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NZD/USD Bears Eye Up the 200-Day Simple Moving Average (SMA) As They Target 0.7200 USD

June 8, 2021

Talking Points:

  • NZD/USD breaks a two-day uptrend and now looks to head lower.
  • The Immediate downward trend line fights the vital SMA amid recovering Momentum.
  • Additional Bear momentum may await a strong breakthrough in the SMA line, while the bulls require a continued climb towards the two-week-old resistance to regain control.

NZD/USD continues to be on the back foot at 0.7218 USD at the start of Tuesday’s trading session. Resulting in the pairs first intraday losses in the past three days as bears eye up the 200-day SMA.

However, the recovery of the Momentum line and the strong SMA are testing the NZD/USD bears at present, the pair’s rebound from 0.7244 USD and a declining trend line starting from the 26th of May could signal additional downward movement. 

In this scenario, the 0.7200 USD and 0.7190 USD levels could be a resting point for the bears before they attempt to drive the pair towards the monthly low of 0.7125 USD.

From the bulls point of view a corrective pullback above the support-turned-resistance line from last week, around 0.7245 USD, will have to break through the two-week-long declining trend line around 0.7255 USD to support the bulls momentum.

In this scenario, the monthly high of around 0.7300 USD and the end of Mays top close at 0.7320 USD will be the next targets for the bulls.

Overall, the signals would suggest that the pair remains under pressure and the latest trend line break would imply that it favours the intraday sellers.

 

NZD/USD Four-Hour Chart:

 

 

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