NZD/USD Price Analysis: Bears extend control below 200-DMA, focus on Friday’s close
- NZD/USD deepens Thursday’s pain ahead of the critical NFP report.
- A breach of the 200-DMA support keeps NZD bears alive and hopeful.
- A daily closing below the 200-DMA is waited for the downside validation.
NZD/USD is extending losses into the second straight session on Friday, as the bears remain relentless amid re-ignition of the Chinese property sector concerns, with Kaisa Holdings shares suspended for trading on Hong Kong after missed payments.
Meanwhile, markets reassess the global tightening bets after the Fed and the Bank of England (BOE) came out dovish at their respective monetary policy decisions, disappointing the hawks.
With the Reserve Bank of New Zealand (RBNZ) likely to announce another rate hike this month, investors are turning skeptical about the expected policy move, exacerbating the pain in the kiwi.
All eyes now remain on the US Nonfarm Payrolls data for further trading impetus.
From a short-term technical perspective, the currency pair is looking to accelerate its declines towards the upward-sloping 50-Daily Moving Average (DMA) at 0.7062 after it decisively breached the critical 200 and 21-DMAs confluence support at 0.7100.
However, to validate the further downside, the bears need a daily closing below the latter.
The 14-day Relative Strength Index (RSI) is inching lower below the midline, suggesting the additional downside cannot be ruled out.
NZD/USD daily chart
On the flip side, the 0.7100 previous support now resistance will test the immediate recovery attempts.
Acceptance above that level will trigger a fresh upswing towards the 0.7150 psychological level, above which the strong resistance around 0.7175 will come into play.
NZD/USD additional levels to watch