Nzdusd Tumbles Lower On Oversold Rsi

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Nzdusd Tumbles Lower On Oversold Rsi

Nzd/Usd Tumbles Lower On Oversold Rsi

After a long back-and-forth, NZD/USD has finally broken out of its range. However, it is not good news for the bulls as the NZD/USD has broken out of the bottom end of the trading range.

Additionally, the RSI is also showing oversold readings, which is yet another for the NZD/USD to show some corrective moves in the near term.

Nzd/Usd Breaks Out Of 0.6080 - 0.6210 Range

It's been months now since the NZD/USD is trading between 0.6080 - 0.6210. However, the pair finally managed to break the 0.6080 support for good, which is now acting as a strong resistance for the NZD bulls.

For now, the NZD/USD is seen near 0.6035 as the pair has already covered some distance away from the 0.6080 level. The RSI shows oversold readings, which suggest that the NZD/USD needs to go through a correction wave. However, this reading also highlights that the NZD/USD can also stage another bull rally in the short term.

The risk of yet another bullish wave is the reason why we are not seeing any follow-through with the selling of NZD/USD. In fact, many traders have even closed their short positions due to this exact reason.

Although the long-term trend in NZD/USD is still bullish, the short-term has moved towards the bearish phase. So, in the short-term, the most relevant picture is that of a bear rather than a bull.

Another thing that hints at more downside is that we can use the height of the previous trading range as a measure of how far the NZD/USD can go lower. So, if we take that into account, it suggests that the pair can go lower by around 80-100 pips.

However, one key catalyst that can allow the NZD/USD to resume its uptrend once again will be potential dovish comments from the Federal Reserve. But given the CPI reading from the USA, there's very little chance of that happening anytime soon.

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