NZD/USD Price Analysis: Climbs to over 1-week tops, approaching descending channel resistance

• NZD/USD gained traction for the third straight day and recovered further from one-month lows.
• The technical set-up supports prospects for an eventual breakthrough a descending trend-channel.
• Slightly overbought RSI on the 1-hourly chart warrants some caution before placing fresh bullish bets.

The NZD/USD pair built on this week’s rebound from over one-month lows, around the 0.6520 region and gained traction for the third consecutive session on third consecutive session on Wednesday.

A sustained move beyond 200-hour SMA was seen as a key trigger for intraday bullish traders and the subsequent momentum pushed the pair to over one-week tops during the early European session.

Any subsequent positive move is likely to confront stiff resistance near the top boundary of an upward sloping channel, extending from the last week of June, currently near the 0.6335 region.

Bullish oscillators on 4-hourly/daily charts support prospects for additional gains. However, slightly overbought RSI on the 1-hourly chart warrants some caution for aggressive bullish trades.

Hence, it will be prudent to wait for a sustained breakthrough the trend-channel barrier before positioning for any further appreciating move, possibly towards reclaiming the 0.6700 mark.

Conversely, rejection slide from the mentioned hurdle now seems to find some support near the 0.6600 mark. This is followed by the 0.6580 horizontal level, which should act as a pivotal point for short-term traders.

NZD/USD 4-hourly chart

Technical levels to watch