The NZDUSD moved higher earlier in the session and in the process tested a swing area between the 0.6688 to 0.66925. I spoke about this area in a post on the pair yesterday.
The buyers could not sustain momentum above that level. The dollar buying and more recent risk off, has led to a sharp move to the downside in the pair.
That move has now taken the price back below the 200 and 100 hour moving averages (green and lines in the chart above) and down to a lower swing area between 0.66134 and 0.66195.
Traders looking for more downside (more dollar buying), will be watching the 0.66195 as close resistance. Other resistance might be at the 0.66279 level. That was the low price from yesterday and also the 38.2% retracement of the move down from last Friday's high to Monday's low.
The pair has traded outside of the range area since July 21 (defined by the red box) but the value area (or area where the most trading has taken place since July 21) is within those extremes (from 0.6613 and 0.66925). That is pretty narrow range at 79 pips.
As a result at some point we should get a break and move outside of this non-trending range with market participants looking to trend the market.
The sellers are currently pushing the downside lower value area, after the buyers had their shot at the start of the day (and failed). Can they succeed in pushing lower and getting the pair outside of the up and down range area? Watch the correction areas for clues as to the sellers strength.