NZD/USD Price Analysis: Gravestone Doji near crucial resistance of 0.7000, downside looks likely

• Confluence of Gravestone Doji near the psychological resistance of 0.7000 indicates the strength of bears.
• Kiwi bulls have surrendered their establishment above 61.8% Fibo retracement.
• The momentum oscillator RSI (14) seems losing its momentum after dropping below 60.00.

The NZD/USD pair has displayed multiple failed attempts while practicing an establishment above 0.7000. The pair have witnessed an extreme responsive selling from the market participants on Tuesday, which has dragged the kiwi bulls below 0.6950. In the early Asian session, the asset is performing subdued and is expected to extend losses after slipping below Wednesday’s low at 0.6933.

On a daily scale, NZD/USD has formed a ‘Gravestone Doji’ candlestick pattern, which signals a failed attempt by the bulls on driving the asset to fresh highs. The pair has failed to breach its old recurring barricade of 0.7000, which has also been encountered consecutively in the last two weeks. Apart from that, the kiwi bulls have lost their establishment above 61.8% Fibonacci retracement (placed from 21 October 2021 high at 0.7219 to 28 January low at 0.6529) at 0.6956. However, the trendline placed from the 28 January low at 0.6529 will continue to act as major support going forward.

The 20- and 50-period Exponential Moving Averages (EMAs) at 0.6906 and 0.6845 respectively are scaling higher, which signals more upside ahead.

However, the Relative Strength Index (RSI) (14) seems losing momentum as the oscillator has dropped below 60.00.

Should the asset drop below Wednesday’s low at 0.6933, it will trigger the formation of the Gravestone Doji candlestick pattern and activate the greenback bulls. Activation of the latter will drag the asset towards 50% Fibo retracement at 0.6875, followed by the 50-EMA at 0.6845.

On the flip side, kiwi bulls may regain strength if the asset overstep the psychological resistance of 0.7000, which will drive the asset higher towards the 19 November 2021 high at 0.7050, followed by the 22 October 2021 low at 0.7131.

NZD/USD daily chart