The NZDUSD tested the low from yesterday at 0.67354 and bounced in early Asian trading.
The price has wandered higher but has moved up and down in the London/US session. The high for the day was able to extend briefly above its 100 hour moving average, but that break quickly failed. The 100 hour moving averages currently at 0.67778.
Although the break failed, the pair is continued to push against that moving average line on hopes for a break and continuation toward the falling 200 hour moving average currently at 0.68022. The last time the price moved above that moving average was way back on November 9.
If the buyers are to take control, getting above both those moving averages is the minimum requirement. Failure to do that and the sellers continue to be more control/the buyers are simply not winning.
The good news for the dip buyers is that there is now a double bottom at 0.67354.
The not so good news for the buyers is that the price still needs to get above the moving averages.
Fundamentally, the NZDUSD has moved lower despite the RBNZ moving to slow economic growth by tightening twice (they are leading the tightening cycle of the major currencies). Admittedly, the market may be forward-looking and expecting slower growth as a result of their tightening (and expected tightenings going forward). The market is also wrestling with the Omicorn variant implications. Nevertheless if the storyline does tilt, there is probably room to roam to the upside for the pair.
- The move down around 420 pips over the last five or so trading weeks
- the price traded down to the lowest level since November 2020
Looking at the daily chart below, a move above the August swing low at 0.68042 would dovetail the falling 200 hour moving average at 0.68022 and give the buyers more of a technical reason to push to the upside for the pair. The first step is to get above the 100 hour MA though.
