- NZD/USD reverses Monday’s recovery moves with mild losses.
- Strong Momentum line may tease bears but bulls will refrain to enter below 100-HMA.
NZD/USD bounces off an intraday low of 0.6970 while licking its wounds, down 0.13% on the day, amid early Tuesday.
The kiwi pair’s recovery from a seven-month low failed to cross the 0.7000 threshold, which in turn portrays a bearish chart pattern on the hourly (1H) play.
It should, however, be noted that the 50-HMA level teases the sellers amid an upbeat Momentum line, around 0.6970, near to the confirmation of the bearish flag.
While the buyers are likely to print on-and-off moves around 0.6970, the sellers’ ability to conquer the key support will make the pair vulnerable to decline towards the September 2020 tops surrounding the 0.6800 theshold. During the fall, the recent low of around 0.6920 may act as a buffer.
Alternatively, the corrective pullback may remain below the flag’s resistance line, near 0.7012, while the 0.7000 psychological magnet can offer immediate resistance. Also acting as the upside filter is 100-HMA level of 0.7025.
NZD/USD hourly chart
Trend: Further weakness expected