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Technical Analysis – NZDUSD consolidates as cloud contests price gains
NZDUSD’s recent propulsion over a restrictive line and the 50- and 100-day simple moving averages (SMAs) is being curbed by the Ichimoku cloud around the 0.7239 level, which happens to be the 23.6% Fibonacci retracement of the up leg from 0.6510 until 0.7464. The climbing 200-day SMA is shielding the positive structure, while the 50- and 100-day SMAs are reflecting a neutral phase in the pair.
The Ichimoku lines indicate that positive momentum has lost its might, while the oscillators are favouring more the upside. The MACD, above its red trigger line, has pushed over the zero threshold, while the RSI is tiptoeing higher in the bullish region. The stochastic oscillator has turned bearish however the %K line has yet to break the supportive line to confirm growing selling interest in the pair.
To the upside, buyers will need to initially combat the capping resistance zone existing between the 0.7204 barrier and the 23.6% Fibo of 0.7239. Surpassing this key obstacle and overstepping the cloud, the nearby 0.7306 high could attempt to impede buyers’ efforts from reinstating a more convincing up move. Conquering the above mentioned hurdle, is critical to reviving more upside thrust to challenge the buffer zone formed between three rally peaks - identified in September 2017, January and February 2018 - and the near 43-month high of 0.7464.
If sellers seize control, instant resistance may occur at the fused 50- and 100-day SMAs at 0.7150 before the 38.2% Fibo of 0.7098 comes into play. Should the price charge lower, the support base of 0.6942-0.7000 may prove adequate to dismiss a deeper price plunge. However, if the 200-day SMA at 0.6926 fails to assist, the price may then test the 61.8% Fibo of 0.6876.
Summarizing, NZDUSD appears stagnant, awaiting new impetus to form a decisive price direction.