Technical Analysis: NZDUSD drops back towards 0.6900 despite RBNZ rate hike
RBNZ leads the developed-world central banks with a 0.25% rate hike on Wednesday but couldn’t lift the NZDUSD prices. The reason can be linked to the broad US dollar strength amid risk-off mood and firmer Treasury yields. Technically, the Kiwi pair’s failures to cross the 10-DMA hurdle joined the bearish MACD signals and downward sloping RSI line to weigh on the quote. However, a horizontal area established from mid-June near 0.6915-25, becomes the key barrier for the pair’s further downside towards an ascending support line from August 20, around 0.6870. Also acting as a support is the latest swing low close to 0.6860 that can question the sellers before offering the yearly bottom of 0.6805.
On the contrary, a clear upside break of the 10-DMA, at 0.6857 by the press time, won’t be enough for the NZDUSD bull’s welcome as a three-week-old resistance line near 0.7015 holds the gate for entry. In a case where the pair cross the trend line resistance, the 0.7080-85 region comprising multiple levels marked since late July may act as a buffer before propelling the quote to the last month’s high near 0.7170.