The NZD/USD pair extends the overnight pullback from the vicinity of the 0.6300 mark, or its highest level since February 16 and witnesses some follow-through selling on the last day of the week. The downward trajectory picks up pace during the first half of the European session and drags spot prices to a fresh daily low, closer to the 0.6200 round figure in the last hour.

It is worth recalling that the US central bank, as was widely anticipated, raised interest rates by 25 bps on Wednesday, though sounded cautious in the wake of the recent turmoil in the banking sector. Furthermore, the Fed lowered its median forecast for real GDP growth projections for 2023 and 2024. This leads to a further decline in the US Treasury bond yields and should act as a headwind for the Greenback.

This, in turn, warrants some caution before positioning for an intraday depreciating move for the NZD/USD pair. Even from a technical perspective, the recent two-way range bound price action witnessed over the past two weeks or so also points to indecision over the next leg of a directional move. The base of the sideways range is actually at just below 0.6200 suggesting the pair may find support and begin a new leg higher if the range extends. That said, repeated failures to find acceptance above the 200-day Simple Moving Average (SMA) favour bearish traders and could see a breakout lower.

The price has been slicing through various levels of structure over the course of the year and 0.6064 is eyed on a break of the dynamic trendline support.

From an hourly perspective, 0.6220 and 0.6200 are key structures should the bears manage to keep control below what will be considered as counter-trendline resistance.

Breakout below order block opening doors for more losses

Mar 24 2023

Stop Loss -1.82%

Holding time 2d19hr

0.61928

Entry price

0.63056

Stop loss price