- NZD/USD takes the bids to refresh intraday high, prints the first daily gain in four.
- Kiwi pair’s recovery from two-month-old support line needs validation from 200-EMA and NZ/US data.
- Downbeat oscillators, two-week-old falling resistance line acts as additional upside filters.
NZD/USD snaps a three-day downtrend as it extends late Friday’s rebound from a two-month-old ascending support line towards 0.6200 heading into Monday’s European session. In doing so, the Kiwi pair cheers upbeat sentiment data at home, as well as China stimulus, while teasing the bulls as markets await July’s employment data for New Zealand (NZ) and the US.
However, the bearish MACD signals join the near 50.0 levels of the RSI (14) line and the 200-Exponential Moving Average (EMA) surrounding 0.6220 to challenge the NZD/USD bulls.
Even if the quote crosses the 0.6220 hurdle, a downward-sloping resistance line from July 14, close to 0.6240 at the latest, can act as the final defense of the NZD/USD buyers, a break of which could quickly propel the quote past the 0.6300 round figure. The same highlights an upward-sloping resistance line from early February, near 0.6380 by the press time.
On the flip side, a daily closing below the three-month-old rising support line, surrounding 0.6130 at the latest, could drag the price toward the lows marked in June and March, near 0.6050 and 0.6085.
Should the NZD/USD remains bearish past 0.6050, multiple levels around 0.6030 and the 0.6000 round figure will be crucial for the bears to watch.
Overall, the Kiwi pair buyers flex their muscles but the bears are still in the driver’s seat.
NZD/USD: Daily chart
Trend: Limited recovery expected