NZD/USD Retests 0.6880 Support Turned Immediate Resistance Level

NZD/USD Retests 0.6880 Support Turned Immediate Resistance Level

Adding on to Monday's minor recovery, the NZD/USD pair has been steadily climbing higher and is inching closer to 0.6900 mark to currently trade around 0.6880 level.

Last week the pair registered 3-day of continuous sharp declines, forming a bearish reversal pattern, three black crows, suggesting weakness in the established up-trend and potential emergence of a near-term down-trend.

Technical levels to watch

The pair is currently trading near its previous support confluence region near 0.6880 level, comprising of 20-day SMA and 23.6% Fibonacci retracement level of 0.6347-0.7054 up-move, which now seems to act as immediate resistance on the upside. Any further recovery beyond this immediate resistance now seems to be capped near 0.6915-20 horizontal resistance area.

Reversal from current resistance level and a follow-through selling pressure below Friday and Monday's lows support near 0.6835-30 has the potential to drag the pair towards its next major support near 0.6780-70 confluence region, comprising of 50-day SMA and 38.2% Fibonacci retracement level.