- NZDUSD attracts some dip-buying near the 0.6385-80 strong horizontal support.
- A sustained strength beyond 0.6500 handle will confirm a bullish flag breakout.
- The momentum could lift the pair to the recent swing high, near 0.6580-85 zone.
It’s Throwback Thursday and we look back to our NZDUSD bullish call on June 24. As was expected, the pair attracted some dip-buying ahead of the 0.6380 strong horizontal support. The subsequent positive move lifted the pair back closer to the key 0.6500 psychological mark.
The mentioned handle marks the top end of a downward sloping channel. Against the backdrop of the recent strong positive move witnessed over the past three months or so, the channel constitutes the formation of a bullish continuation – flag chart pattern.
Meanwhile, bullish RSI and MACD indicators on the daily chart add credence to the constructive set-up. This coupled with the fact that oscillators on the 4-hourly chart have again started gaining positive traction now supports prospects for an eventual break on the upside.
A convincing breakthrough might prompt some technical buying and lift the pair back toward the 0.6580-85 area – multi-month tops set on June 10. The momentum could further get extended beyond the 0.6600 handle, towards testing the next major hurdle near the 0.6645-50 region.
On the flip side, any meaningful pullback now seems to find immediate support near the 0.6425 zone, which is closely followed by the 0.6400 mark and the 0.6385-80 region. Failure to defend the mentioned support levels will negate the bullish outlook and drag the pair further towards the trend-channel support, currently around the 0.6325 region.