• NZD/USD extends bounce off weekly low to rise the most among G10 currency pairs.
• 200-SMA, one-week-old descending trend line restricts short-term upside.
• Bears need validation from monthly upward sloping support line.
• RSI rebound, easing bearish bias of MACD adds strength to the recovery hopes.

NZD/USD pokes the short-term key resistance while grinding higher around 0.6790 heading into Wednesday’s European session.

The Kiwi pair carries the previous day’s bounce off a one-month-old ascending trend line to lead the G10 currency pair gainers, up 0.32% intraday at the latest.

However, a convergence of the 200-SMA and a one-week-long descending trend line, around 0.6790-95, become the short-term key hurdles to test NZD/USD rebound.

In a case where NZD/USD bulls cross 0.6810, a run-up towards the two-month-old horizontal area surrounding 0.6890-95 will gain the market’s attention.

Meanwhile, NZD/USD pair’s further declines hinge on the clear break of an upward sloping support line from December 20, near 0.6750.

Following that, a slump to the year 2021 trough surrounding 0.6700 will be imminent while the 61.8% Fibonacci Expansion (FE) of the pair’s moves between November 15 and December 24, near 0.6650, will be in focus afterward.

NZD/USD: Four-hour chart

Trend: Further recovery expected