NZD/USD: The sharp reversal lower comes to a halt ahead of the 55-DMA at 0.6633 – Credit Suisse

NZD/USD stages a modest rebound after dropping to two-week lows at 0.6639. Supports at 0.6639/33 and 0.6601/6600 ideally hold for further rangebound trading, with resistance seen initially at 0.6678, per Credit Suisse.

Key quotes

“NZD/USD forcefully extended its rejection from the pivotal July 2019 and current 2020 highs as well as the 200-week average at 0.6783/98 on Monday. However, the correction lower is so far coming to a halt just ahead the 55-day average at 0.6639/33 and with key price support just below at 0.6601, we ideally look for the zone to hold for further rangebound trading.”

“Below 0.6639/33 would see a move back to the 0.6601/00 support, which is a key technical inflection point. Beyond here though would see a small ‘double top’ complete to suggest significant further weakness.”

“We see resistance initially at 0.6678, then 0.6693/96, above would ease the immediate downside pressure for a move back to the aforementioned 0.6783/98 area, which we expect to cap for now to maintain the range.”