NZD/USD Finds a Pause in Its Descent at Key Fibonacci Level

The NZD/USD pair has been on a notable downward trajectory since facing resistance twice near the 0.6217 mark in early March. This week, the currency pair reached a new low for the past four months, yet indications suggest it may be stabilizing around the 0.5952 level, corresponding to the 23.6% Fibonacci retracement from the decline spanning 0.6536 to 0.5772.

With both the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) indicators leaning towards a bearish outlook, there’s a potential for the pair to retest the 23.6% Fibonacci level at 0.5952. Breaching this threshold could lead the pair towards the September 2023 low at 0.5858, a level that was also significant in November. A failure to maintain this could see the pair aiming for the yearly nadir at 0.5772.

Conversely, should the NZD/USD pair embark on a recovery, the initial resistance might emerge at the 0.6037 mark, previously observed as support in February. Any further upward movement might encounter resistance at the 38.2% Fibonacci level of 0.6064, which coincides with the 200-day Simple Moving Average (SMA). Overcoming this hurdle could open the path to the 50.0% Fibonacci retracement at 0.6154.

In essence, the NZD/USD pair has descended to a significant four-month low, with the 23.6% Fibonacci retracement acting as a critical juncture. A decisive breach below this point could signify an acceleration in the downward momentum.

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