NZD/USD Price Analysis: Bulls expect a sustained break through the 0.6250-60 confluence

• NZD/USD is once again approaching the weekly high, although it is struggling to capitalize on the move.
• The risk averse state seems to limit the kiwi near the 0.6250-0.6260 confluence.
• A break below 0.6100 would turn the short-term trend in favor of bears.

The pair NZD/USD is supported by yesterday’s good bounce from the 0.6140-0.6135 zone and gets strong follow-through traction for the second day in a row on Friday. The pair maintains its offered tone at the beginning of the American session, although it seems to struggle to capitalize on the movement and remains below the 0.6260-0.6270 confluence barrier, or weekly highs

This barrier comprises the 200-day EMA and the 38.2% Fibonacci level of the February-March dip. With oscillators on the daily chart just beginning to gain positive traction, a sustained move beyond will be seen as a new trigger for bullish traders and set the stage for an extension of the recent NZD/USD rally from the bottom. annual played last week.

Spot prices could pick up the 0.6300 signal, which coincides with the 50% Fibo level. The momentum could extend further and push the NZD/USD pair towards the Fib level. 61.8% around the 0.6360 zone, on the way to the next major hurdle just ahead of the 0.6400 signal.

However, a new wave of global risk aversion trading prevents bulls from making aggressive bets on the risk sensitive Kiwi and capping the NZD/USD pair. However, the technical situation supports the prospects of a significant rise. Therefore, any pullback towards 0.6200 or the 23.6% Fibonacci level could still be considered a buying opportunity and is more likely to remain limited, at least for now.

That being said, a convincing break below this last level could nullify the positive outlook and turn the short-term trend back in favor of the bears. The NZD/USD pair could then accelerate the decline towards the intermediate support of 0.6135-0.6125 before finally falling to 0.6100. A continuation of selling below the 0.6085 zone, or last year’s low, could jeopardize the key 0.6000 psychological level.

NZD/USD daily chart

Key levels to watch