The NZD/USD pair crashed in the short term. Now, it has managed to rebound and to recover a little as the Dollar Index crashed. It seems that the DXY was overbought even with the US positive data.
Surprisingly or not, the NZD/USD pair rebounded despite the New Zealand Retail Sales dropping by 0.6% versus the 0.2% growth expected, while Core Retail Sales registered a 1.3% drop compared to the 0.3% growth estimated. On the other hand, the US Pending Home Sales and Core Durable Goods Orders came in better than expected, while the Durable Goods Orders came in worse than expected.
Tomorrow, the US data could be decisive. CB Consumer Confidence, Richmond Manufacturing Index, Goods Trade Balance, and Chicago PMI could really shake the price.
NZD/USD bearish bias
The NZD/USD pair extended its sell-off after escaping from the triangle pattern. It has ignored the 0.6191 historical level, signaling more declines. Still, after its strong sell-off, a rebound was natural.
The NZD/USD pair found resistance at 0.6173, and now it could turn to the downside. It has registered only false breakouts through this level, signaling that the rebound could be over.
NZD/USD outlook
Staying below 0.6173 may announce that the rebound ended and that the sellers could take it down. This is seen as the first selling opportunity. Closing above the 0.6173 resistance may signal a potential growth towards the median line (ML) and up to the downtrend line. Registering false breakouts above these obstacles should bring new selling signals. Also, a new lower low activates a deeper drop and is seen as a bearish signal.
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