NZD/USD sellers broke below the pair's multi-week trading range, pushing the price to a fresh low before it steadied. The move opens the door to further declines if sellers can hold the pair below the old range floor.
Sellers pushed NZD/USD below the lower end of its recent range, to a low of 0.5853, with the pair now trading near 0.5857. The pair had been confined between 0.5858 and 0.5906 since July 30, and sellers are now making a play for a breakout below that floor.
The question now is whether sellers can build on that break. A sustained move below 0.58526, the 61.8% retracement of the decline from the June 1 high, would strengthen the bearish bias. That would open the path toward the 0.5813-0.58219 swing area, followed by the 50% midpoint of the range since June 1 at 0.58092.
Sellers still need to prove they can keep the price below the broken range floor, however. If they fail to capitalize on the move lower, the risk shifts toward another snapback rally.
On the topside, the converged 100- and 200-hour moving averages near 0.5877 mark the first hurdle in the new trading day. A move back above those averages would weaken the bearish bias and shift focus back toward the 0.5906 swing-high area.
Staying below 0.58526 keeps sellers in control; a failure to extend lower would raise the risk of a rotation back toward those key hourly moving averages.
Source: InvestingLive
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