The NZDUSD moved higher today, helped by the broader decline in the U.S. dollar following weaker-than-expected U.S. ADP employment data and the ongoing government shutdown. The shift in sentiment provided a tailwind for the pair, but the move higher also fits into a bigger technical story.
Last week, the pair completed a downside cycle after failing on a break below a key swing area between 0.57599 and 0.57716. That failure attracted dip buyers and laid the foundation for a corrective bounce. On Monday and Tuesday, the price action was choppy, but the back-and-forth movement carried the pair back up to test the 50% midpoint of the move up from the April low, signaling that buyers were gaining more influence.
Momentum picked up again today, with the NZDUSD extending to a high of 0.5831, which tested a swing target at 0.58303. Sellers leaned against that level, and the price has since rotated lower, currently trading around 0.5816. This pullback shifts the focus back to the broken 50% midpoint support at 0.5800, which now serves as a key barometer for the next move.
If buyers can hold above 0.5800, it will keep the bullish bias intact and leave the door open for another push toward the 0.5830 resistance zone and potentially higher. On the other hand, a move back below 0.5800 would suggest a failed breakout attempt, giving sellers more confidence to press the downside. With resistance holding firm and support clearly defined, the NZDUSD is now locked in a battle zone, and traders will be watching closely to see which side takes control.
