NZD/USD Outlook: Drops near the 200-day SMA, focusing on the 0.5800 level
NZD/USD Drops Sharply Amid Rising US Yields
The New Zealand Dollar experienced a significant decline during the North American trading hours, pressured by stronger US Treasury yields that boosted the US Dollar to a fresh two-day peak. Heightened tensions in the Middle East also contributed to the Greenback's strength. At the time of reporting, NZD/USD was trading near 0.588, marking a loss of almost 1% and holding just above its 200-day Simple Moving Average (SMA).
Technical Analysis: NZD/USD Outlook
From a technical perspective, the New Zealand Dollar is showing signs of vulnerability. Should NZD/USD close the day below the 200-day SMA at 0.5876, it could signal a shift toward a bearish trend. Over the past two sessions, the pair has hovered around this key level, with buyers stepping in to prevent a deeper decline so far.
If the pair ends the day beneath the 200-day SMA, attention will turn to the 100-day SMA at 0.5817 as the next potential support. Continued downward momentum could see the pair targeting 0.5800, and possibly moving lower toward the January 19 swing low at 0.5737.
With the Relative Strength Index (RSI) pointing to increasing bearish momentum, it is crucial to watch whether NZD/USD can maintain support above the 200-day SMA on a daily closing basis.
NZD/USD Daily Price Chart
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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