NZD/USD Price Analysis: Licks RBNZ-led wounds near 0.6900, bears in control
- NZD/USD pares intraday losses around seven-week low after RBNZ’s rate hike.
- 78.6% Fibonacci retracement, oversold RSI conditions challenge bears.
- Two-week-old resistance line, 50-DMA restrict short-term rebound.
NZD/USD stays on the back foot despite a recent bounce off the multi-day bottom to 0.6906 ahead of Wednesday’s European session. The kiwi slumped to the lowest since early October after the Reserve Bank of New Zealand (RBNZ) didn’t surprise markets by 25 basis points (bps) of a rate hike.
Read: NZD/USD slumps towards 0.6900 on RBNZ’s 0.25% rate hike, Governor Orr’s speech eyed
NZD/USD bears drill 13-week-old support line, at 0.6930 by the press time, amid heavy bearish bias portrayed by the MACD. However, RSI nears the oversold territory and hints at a rebound should the quote manage to cross the 61.8% Fibonacci retracement (Fibo.) of August-October upside, around 0.6960.
In a case where the quote rises past the immediate Fibo. hurdle, a descending resistance line from November 09 and 50-DMA, respectively around 0.7020 and 0.7050, will challenge the buyers.
Alternatively, a daily closing below the stated support line figure of 0.6930 will have another chance to recall the NZD/USD buyers, around 78.6% Fibonacci retracement level of 0.6890.
To sum up, the pair bears seem to have tired of late but the bulls have a way to go before retaking the controls.
NZD/USD: Daily chart
Trend: Further weakness expected