EURNZD has come under renewed selling pressure and has fallen back below the 1.7000 handle, though it remains inside the Ichimoku cloud.
The technical indicators are falling simultaneously with the price, as the RSI found a wall at the 70 level and declined sharply lower, while the stochastic created a bearish cross with its %K and %D lines in the oversold zone. However, the 20 and 40-day simple moving averages (SMAs) completed a bullish cross, confirming the upside move towards 1.7175 in the preceding days.
The 1.6920 barrier is the nearest support that could reject any attempt lower, which coincides with the red Tenkan-sen line. If breached and the price extends negative momentum, the 23.6% Fibonacci retracement level of the down leg from 1.7700 to 1.6615 at 1.6870 may attract attention. Clearing this zone, the pair could see the 1.6660 support.
On the flip side, an upside reversal above the 38.2% Fibonacci of 1.7030 could bring the 50.0% Fibo of 1.7156 and 1.7175 resistance overhead back into view. Should they fail to hold, the 61.8% Fibo of 1.7285 would be the next target to watch.
All in all, the market is expected to hold bearish in medium-term after the bounce off the 1.7700 handle.
