With a few overshoots to the upside and to the downside, NZD/CHF continues to trade within a range between the 0.6785 and 0.6910 levels. Such activity started at the end of January and the pair continued to move sideways ever since. After a failed attempt yesterday to travel higher, when NZD/CHF broke above the upper bound of that range, the rate slid back below it and now seems to be holding its course south. From the very short-term perspective, we will aim a bit lower.
If the bears continue to push NZD/CHF lower, it could test a key area of support between the 0.6852 and 0.6862 levels. The rate could rebound back up, but if the selling momentum remains strong, then another slide towards the above-mentioned support area, this time could result in the rate piercing through it. We will then examine the 0.6832 hurdle as the next potential support target for NZD/CHF, which is also near the 200 EMA on the 4-hour chart.
Looking at our oscillators, after topping yesterday, both have shifted lower. Indeed, the RSI has moved to the downside after hitting resistance near 80, but still remains slightly above 50. The MACD, even though still in the positive territory, has moved below its trigger line and is pointing to the downside.
Alternatively, if NZD/CHF makes another run to the upside and breaks above the upper bound of the range, this could start worrying the bears again. However, in order to get more comfortable with the upside, we would like to see a push above 0.6920. This would confirm a forthcoming higher high and the rate could accelerate further. We will then look into the possibility of seeing a test of the 0.6940 hurdle, a break of which could lift the pair to the 0.6960 resistance zone, marked near the high of June 14th.
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