NZD/USD range trading is likely to continue while the price remains at the supply zone.

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Updated: 21 May 2020

Hello traders! As per the 8-hour chart, the NZD/USD consolidation phase is still ongoing. Price has been locked between the 0.5940 support and 0.6130 resistance areas during the past 6 weeks. When NZD/USD has been at the resistance zone last time, back on May 11, it rejected the 200 Exponential Moving Averages and produced the high at 0.6156.

Yesterday NZD/CHF attempted to break 0.6156 level, although failed to close above, confirming that bears are still in control. Therefore, the consolidation phase is likely to be extended further, at least till the end of the month.

However, this time NZD/CHF might not reach the previous support area at 0.5940, but perhaps it will target 0.5976 level. This support level is confirmed by two Fibonacci retracement levels, first applied to the previous wave down, and second is applied to the current wave up. Both, 23.6% and 76.4% Fibs are pointing right at the 0.5976, which is likely to be strong support. But if price manages to break below this level, it could re-test 0.5940 support and even confirm the long term downtrend.

Bias: Sideways while below 0.6160

Potential Resistance Zone: 0.6130 -0.6160

Potential Targets: 0.5976

Have a profitable trading!