NZD/USD Faces Key Breakout Zone at 0.6600
- NZD/USD started a major decline below 0.6720 and 0.6600.
- A key bearish trend line is forming with resistance near 0.6565 on the 4-hours chart.
- Gold price started a fresh increase above the $1,900 resistance.
- The US ADP Employment increased 247K in April 2022, down from 479K (revised).
NZD/USD Technical Analysis
The New Zealand Dollar started a major decline from well above 0.6800 against the US Dollar. NZD/USD broke the 0.6650 support to enter a bearish zone.
Looking at the 4-hours chart, the pair extended decline below 0.6550. There was also a close below 0.6500, the 200 simple moving average (green, 4-hours), and the 100 simple moving average (red, 4-hours).
The pair traded as low as 0.6410 and recently started a consolidation phase. On the upside, an initial resistance is forming near the 0.6560 level.
The 38.2% Fib retracement level of the main decline from the 0.6813 swing high to 0.6410 low is also near 0.6500. The first major resistance is forming near the 0.6570 level. There is also a key bearish trend line forming with resistance near 0.6565 on the same chart.
If there is an upside break above the trend line, the pair could test the 50% Fib retracement level of the main decline from the 0.6813 swing high to 0.6410 low.
If not, there is a risk of more losses below 0.6500. The next major support is near the 0.6400 level. Any more losses may perhaps push NZD/USD towards the 0.6320 support zone.
Fundamentally, the US ADP Employment Change report for April 2022 was released yesterday by the Automatic Data Processing, Inc. The market was looking for an increase of 395K jobs.
The actual result was lower than the market forecast, as the private sector employment increased by 247,000 jobs from March to April 2022.
Looking at EUR/USD, the pair is recovering above the 1.0600 level. Similarly, GBP/USD was able to climb above the 1.2600 resistance.
- BoE Interest Rate Decision - Forecast 1%, versus 0.75% previous.
- US Initial Jobless Claims - Forecast 182K, versus 180K previous.