NZDUSD Is Likely to Continue a Downtrend and Pullbacks Are Unavoidable

NZDUSD Price Analysis – August 23

NZDUSD is likely to continue a downtrend as it appears to be trading above the 0.6800 significant level. The downtrend is perceived to be strong due to a range of consolidations. This consolidation is between the 0.70300 resistance key level and the 0.6900 support level. Because of this accumulation, the breakout is likely to fall beyond the 0.6800 level, which, because of previous price reactions in this zone, is acting as a support.

NZDUSD Significant Zone

Resistance level: 0.70300, 0.69500
Support level: 0.6900, 0.6800

NZDUSD Long Term Trend: Bearish

However, even though the price is at the 0.6800 significant zone, there is some pressure from buyers of the currency pair. A possible continuation of the market’s rise in currency levels is possible. Therefore, as we anticipate a downtrend continuation, we should also expect a pullback. This pullback will occur below 0.6900, or after a breakout below 0.6800, which is a significant level. This zone will now serve as a vital resistance zone. When the price retraces back to this level, the downtrend is likely to continue.

The NZDUSD market is likely to remain bullish for a while before resuming its downtrend. Even though the price is in a bear market, the bulls are reacting to the market environment. In the daily chart, the Stochastic Oscillator produces a golden cross just above the 0.00 level. Therefore, this implies that the market will most likely move in a bullish direction before resuming its downtrend continuation.

NZDUSD Short Term Trend: Bullish

On the 4-hour chart, the market has entered a quiet phase, and the NZDUSD appears to be consolidating. The bulls are gathering some momentum for a pullback. The Parabolic SAR (Stop and Reverse) indicator shows new uptrend dots, indicating a retracement. Also, the Stochastic Oscillator shows multiple crosses in the oversold region. However, this means that the price will almost certainly retrace back to 0.6900 before the NZDUSD market resumes its downtrend movement. We anticipate a pullback followed by a downtrend continuation.

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