- NZD/USD struggles to defend the first positive daily gains in four.
- Two-day-old falling trend line, 50-HMA guards immediate upside, multiple support from June 21 test sellers.
- Momentum line suggests further grinding to the south, bulls may hesitate for entry below 0.7030.
NZD/USD wobbles around 0.6990, up 0.10% intraday, during the first positive day of the week. Even so, the Kiwi pair remains clubbed inside a 40-pips trading region amid a downward sloping Momentum line.
On the fundamental side, downbeat data from China and Australia join the latest covid woes in the Asia-Pacific to weigh on the quote.
Read: AUD/USD stays on the way to yearly low below 0.7500 on mixed Aussie, China data
Hence, the NZD/USD sellers may keep reins but will wait for a clear downside break of 0.6960 for fresh entries targeting the yearly low of 0.6923.
In a case where the bears dominate past 0.69123, the 0.6900 threshold and September 2020 top near 0.6800 will be in the spotlight.
On the other hand, an upside clearance of the 0.7000 round-figure, comprising 50-HMA and immediate falling trend line, could escalate the recovery moves to the 38.2% Fibonacci retracement of June 18-25 upside, near 0.7030.
However, any further upside will enable the NZD/USD buyers to aim for the late June tops surrounding 0.7100 before confronting multiple lows marked between April and June around 0.7125.
To sum up, NZD/USD remains on the back foot despite the latest bounce and hence further losses can’t be ruled out.
NZD/USD hourly chart
Trend: Further weakness expected