NZD/USD Price Analysis: Recovery seeks validation from 200-DMA below 0.6200
- NZD/USD struggles to defend the week-start bounce off three-month low.
- Bullish candlestick formation, oversold RSI underpin recovery hopes.
- Three-week-old descending resistance line, previous support from November add to the upside filters.
NZD/USD seesaws around 0.6160-65 amid early Tuesday, following a week-start bounce off the lowest level since November.
In doing so, the Kiwi pair jostles with the 200-DMA hurdle after posting a bullish candlestick on the daily chart, namely the Dragonfly Doji.
Not only the upbeat candlestick formation but the oversold RSI (14) also suggests the NZD/USD pair’s upside past the immediate hurdle surrounding 0.6170.
The same highlights a downward-sloping resistance line from early February, around 0.6205 at the latest.
Following that, the 61.8% and 50% Fibonacci retracement levels of the pair’s run-up from late November 2022 to early February 2023, near 0.6245 and 0.6300 respectively, could challenge the NZD/USD buyers.
It’s worth noting that the previous support line from November 17, close to 0.6330 by the press time, acts as the last defense of the Kiwi bears.
Alternatively, a daily closing below the multi-day bottom marked on Monday, around 0.6130, will defy the bullish candlestick and can direct the NZD/USD sellers towards the mid-November swing low surrounding 0.6060.
NZD/USD: Daily chart
Trend: Limited recovery expected