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NZDUSD Rangebound after Bouncing Off 30-Month Low

NZDUSD has been trending lower since March, generating a profound structure of lower highs and lower lows. Nevertheless, the pair has been trading sideways in the last few daily sessions, attempting a minor recovery after hitting a 30-month low of 0.5510.

The momentum indicators are endorsing a cautiously positive near-term tone. Specifically, the MACD histogram has jumped above its red signal line but remains in the negative territory, while the stochastic oscillator is ascending sharply towards its 80-overbought region.

To the upside, bullish actions could send the price to test the recent resistance region of 0.5815. Piercing through this barrier, the pair might ascend towards the July low of 0.6060, which could now act as resistance. A break above the latter may turn the spotlight to 0.6160 before the August high of 0.6467 comes under examination.

Alternatively, should selling pressures intensify, the price could encounter initial support at the 30-month low of 0.5510. Sliding beneath that floor, the bears could target the March 2020 bottom of 0.5468. If that floor collapses, the pair will dive towards levels not seen in the past 13 years, where the November 2008 support of 0.5186 might provide downside protection.

Overall, even though the market is pushing for some recovery, it seems that NZDUSD lacks the necessary momentum to alter its short-term picture back to positive. For the latter to be accomplished, a close above the 0.5815 ceiling is initially required.

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