- NZD/USD stays defensive as it attacks short-term key support confluence inside bearish chart formation.
- China PMIs drop in March, NZIER hints at 0.25% RBNZ rate hike.
- 200-SMA, rising wedge’s support line challenge sellers even as bearish MACD signals keep them hopeful.
- Bulls need successful break of 0.6300 to retake control.
NZD/USD grinds near the intraday low surrounding 0.6210 as bears attack a short-term key support confluence on downbeat China data during early Monday.
That said, China’s Caixin Manufacturing PMI for March drops to 50.0 from 51.6 prior and 51.7 market forecasts.
Not only downbeat China PMIs but hopes of a dovish hike from the Reserve Bank of New Zealand (RBNZ), signaled by the latest New Zealand Institute of Economic Research (NZIER) report, also exert downside pressure on the NZD/USD prices.
With this, the Kiwi pair pokes a convergence of the 200-bar SMA and lower line of a one-month-old rising wedge bearish chart pattern. Adding strength to the downside bias are the bearish MACD signals.
Hence, the quote is likely to break the 0.6210 nearby support, which in turn opens the door for the NZD/USD pair’s theoretical slump towards the 0.6000 psychological magnet. However, multiple levels around 0.6140, the 0.6100 round figure and the previous monthly low of 0.6085 can test the Kiwi pair sellers between 0.6210 and 0.6000.
On the contrary, recovery moves may initially aim for 0.6270 hurdle before poking the stated wedge’s top line surrounding 0.6295.
However, the recent swing high around the 0.6300 round figure can act as the last defense of the NZD/USD bears before directing the quote towards the double tops marked in February around 0.6390.
NZD/USD: Four-hour chart
Trend: Further downside expected