NZDUSD Becomes Oversold As Price Sets To Hit A New Low

NZDUSD Analysis – Market Becomes Oversold As Price Sets To Hit A New Low

NZDUSD becomes oversold as price sets to hit a new low. NZDUSD has been in a ranging market since the previous support of $0.65380 was broken. For over six months now, the market has been ranging between the $0.65380 price level and the $0.59850 price level. As of now, the price is in the discount zone of the market’s trading range.

NZDUSD Significant Zones
Demand Zones: $0.59850, $0.55120
Supply Zones: $0.65380, $0.67290

Before the convergence of NZDUSD into the current trading range, NZDUSD was in a bearish trend on a higher timeframe. As January 2023 ended, NZDUSD retested the $0.65380 price level. The retest brought the price downward until a swing low formed at the $0.59850 demand zone. Due to the buying pressure and the selling pressure at $0.59850 support and $0.65380 resistance, respectively, the bearish trend has stopped. The price has been ranging, with both bulls and bears struggling to take control of the market.

In the first week of February 2023, a bearish order block formed during the retraction at the $0.65380 price level. Afterwards, the Moving Average Convergence Divergence (MACD) crossed the zero line to the downside. This indicated the continuation of the market’s bearish trend. Following the formation of the swing low at $0.59850, NZDUSD headed upward. While invalidating the $0.62480 high and the $0.63790 high sequentially, NZDUSD heads upward to create a new high at $0.64120. According to the Stochastic Oscillator, a rally is likely as the price sets to create a new low in the discount array.

Market Expectation

The market trend is bullish as the price rises alongside the rising trendline on the four-hour chart. After a false breakout at the diagonal support, NZDUSD is likely to expand upward. The bullish expansion is expected to continue beyond $0.64120, thereby inducing buy-side liquidity above the $0.64120 swing high.