NZD/USD extends slide below 0.6100 as US dollar consolidates gains

• US dollar gains versus most of G10 currencies as Wall Street losses momentum.
• NZD/USD is still bullish but unable to break critical resistance.

The NZD/USD pair broke below 0.6100 and fell to 0.6080, reaching the lowest in two days. The pair is holding below 0.6100, on negative territory for the second day in a row but up more than 150 pips for the week.

A stronger US dollar versus majors boosted further the ongoing correction in NZD/USD. The DXY is up 0.45% on Friday, as it continues to recover from the three-week lows it hit on Thursday.

Risk aversion earlier also affected the kiwi. Increasing risk of more tensions between the US and China weighed on market sentiment.

Technical outlook

The rally that started on Monday from weekly lows near 0.5900 ran into resistance at 0.6150 and lost strength. The NZD/USD is now making a bearish correction, so far, limited.

Technical indicators and the chart remains biased to the upside, particularly while above the 0.6060 area (20-day moving average). However, in order to clear the way to more gains, NZD/USD has to break and consolidate above the 0.6150 region.

Since early April, the pair has been moving sideways around 0.6050, with support above 0.5900 and resistance at 0.6150.