The NZDUSD has tumbled 3.6% this week with the last 4 trading days to the downside. That is the biggest move lower since September 19, 2022.
This week, the RBNZ raise rates by 25 basis points, but the hike was considered dovish as signals of a pause surprised the market. The pair has moved to the lowest level since November 11, 2022 in trading today.
Technically, looking at the daily chart, the move to the downside yesterday fell below a swing area between 0.60559 and 0.60844, but rebounded back into the swing area into the close.
Today, the price extended above the high of that key swing area reaching a high price of 0.60955. That should have given buyers additional confidence, but sellers entered, buyers gave up, and the stronger US data sent the pair to the new low at 0.6032. The current price trades at 0.60437.
The swing area on the daily chart from 0.60559 up to 0.60844 remains a risk-defining area (bias defining too). If the sellers are serious, staying below that level would keep them in firm control.
On the downside, the price low today got within 8 pips of the 50% midpoint of the move up from the 2022 low to 2023 high. That midpoint comes in at 0.60242. Getting to and through that level going forward (and staying below), would tilt the seesaw bias more in the favor of the sellers from a technical perspective, and would open the door for further downside momentum potential.. Key target.
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This article was written by Greg Michalowski at www.forexlive.com. Source