The NZD/USD pair has sensed selling pressure above 0.6240 in the Tokyo session. The Kiwi asset has attracted significant offers as the US Dollar Index (DXY) has rebounded firmly ahead of the speech from Federal Reserve (Fed) chair Jerome Powell.

the Kiwi pair stays within a bearish chart formation called a rising wedge comprising multiple levels marked since the last Friday.

However, the gradual uplift of the RSI (14) line, not overbought, keeps the NZD/USD buyers hopeful of defying the stated bearish chart formation by crossing the 0.6275 upside hurdle.

Even so, the 200-DEMA and a fortnight-old horizontal resistance area, respectively near 0.6285 and 0.6315, can prod the NZD/USD bulls before directing them to the monthly peak of 0.6385.

It’s worth noting that tops marked in February and April highlight the 0.6385-90 area as a short-term key hurdle for the pair to cross. Also acting as an important upside barrier is the 0.6400 round figure.

On the contrary, a downside break of the 0.6240 mark comprising the stated wedge’s lower line can confirm the bearish chart pattern, which theoretically suggests a fall towards the monthly of near 0.6160.

However, the latest swing low and the previous monthly bottom, close to 0.6180 and 0.6110, act as additional downside filters for the NZD/USD pair traders to watch during the quote’s further declines.

Overall, NZD/USD is likely to grind higher but the bearish chart formation and the key Hourly Moving Average (HMA) prod the bulls. We will further observe and monitor the Kiwi in accordance to its performance above the aforementioned DEMAs.

Kiwi struggling for sustenance above the DEMA200

May 21 2023