- NZD/USD remains under pressure in the initial European trading hours.
- More downside envisioned if price decisively breaks 0.6950.
- Momentum oscillator holds onto the oversold zone with a neutral stance.
NZD/USD extends the previous day's losses on Wednesday. The pair moves with bearish sentiment in a very narrow trade band.
At the time of writing, NZD/USD is trading at 0.6952, down 0.06% for the day.
NZD/USD daily chart
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Technically speaking, the descending trendline from the high of 0.7317 made on May 26 acts as a strong barrier for the bulls. The formation of multi supports near the 0.6950 makes it a critical level to trade.
That said, If NZD/USD is sustained below 0.6950, it could find the first support near the June 21 low in the vicinity of the 0.6935 area.
The Moving Average Convergence Divergence (MACD) indicator trades in an oversold zone . Any downtick in the MACD could trigger more selling opportunities in the pair. The bears would see the levels last seen in 2020.
Next, NZD/USD would test the low of July 21 low at 0.6894 followed by the low made on November 19, 2020, at 0.6878.
Alternatively, if price moves higher, it will first locate the upside target at the 0.7000 horizontal resistance level followed by the July 15 high at 0.7046.
Next, the market participants would be encouraged to take over the 0.7080 horizontal resistance level.