NZDUSD Analysis – Price Retests the 0.68000 Critical Level as It Falls Lower
NZDUSD retests the critical level at 0.68000 as it prepares to push to lower levels. The market is pushing to continue the downward trend that began at the beginning of last month. Price is, however, encountering resistance at some key levels. NZDUSD’s method of bypassing the opposition is to retest a higher level and then push downward from there. This is what happened at the 0.70490 level, and the market is looking to repeat this trick to reach an 18-month low.
NZDUSD Significant Levels:
Resistance Levels: 0.71500, 0.70490
Support Levels: 0.67140, 0.68000
The market sellers brought an end to a prolonged period of consolidation by dashing through the 0.69460 level, which initially confined the consolidation from below. Bulls leveraged the strong support at 0.68000 to push the price in the opposite direction. This continued till NZDUSD came to a standstill below 0.71500. Another drop ensured which also stopped at the mid-level between 0.69460 and 0.68000. Price first retests 0.69460, drops, and then shoots upward past 0.71500.
The market was able to hold above 0.71500 for only a few days before it slumped below to commence a bearish regime. The first resistance came as NZDUSD tried to break the neckline of the double top formation. Price retests 0.70490 and then slumps further, breaking the strong support level at 0.68000. Price fall stops short for a retest back to the level and is now dropping towards 0.67140. All the while, NZDUSD has been trading close to the lower border of the Bollinger Band to show bearish momentum.
After the price retests the 0.68000 price level, it has now fallen to the lower border of the Bollinger Band on the 4-hour chart. This shows how much sellers are willing to drive the market down. The Relative Strength Index has touched down at the border of the oversold region. However, there is now a bullish retracement. Sellers remain insistent on bringing the market down below 0.67140.
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