NZD/USD Price Analysis: Bulls attack balance area in a 0.5700-0.5760 range

• NZD/USD has scaled above 0.5700 as a rebound move has turned into a reversal.

• Kiwi bulls have crossed above the 10-and-20-EMA vigorously.

• The RSI (14) has delivered a range shift in a 40.00-60.00 territory.

The NZD/USD pair has extended its gains after overstepping the immediate hurdle of 0.5692 in the early European session. The asset has refreshed its intraday high above 0.5700 and is expected to advance further as the upside momentum seems upbeat amid weakness in the US dollar index (DXY).

On an hourly scale, the kiwi bulls have attempted to enter into the prior balanced area in a 0.5700-0.5760 range. The balance area indicates a region where most of the auction activity took place. This is also recognized as a mark-down inventory distribution phase, which facilitated market participants to initiate shorts after the establishment of a bearish bias.

The asset has crossed the 10-and 20-period Exponential Moving Averages (EMAs) at 0.5677 and 0.5682 respectively. It is worth noting that the 10-EMA is still below the 20-EMA, which indicates that the upside momentum is extremely strong.

Meanwhile, the Relative Strength Index (RSI) (14) has shifted into the 40.00-60.00 range from the bearish territory of 20.00-40.00. This indicates that the kiwi bulls are not bearish for the time being.

A decisive break above the aforementioned balance area will send the asset towards the round-level resistance at 0.5800, followed by Friday’s high at 0.5888.

On the contrary, the kiwi bulls could lose their control if the asset drops below Monday’s low at 0.5625. An occurrence of the same will drag the asset towards the 23 March 2020 low and the psychological support at 0.5586 and 0.5500 respectively.

NZD/USD hourly chart