NZD/USD Price Analysis: Consolidation looms as bears might not have much more ground to cover

• NZD/USD experiences further losses, slipping to the 0.5875 mark.
• The 0.5880-0.5870 region continues to be a firm support.
• The daily RSI continues deep in oversold terrain, which hints at a looming correction.

In Monday's trading session, the NZD/USD pair slipped further down to 0.5875, tallying a 0.25% decline. This is in hand with a trailing bearish trend, which saw the pair shed more than 4% of its value in July. Traders were bombarded with selling signals last week, especially with the bearish crossover of the 20-day Simple Moving Average (SMA) at 0.6050 with the 100-day SMA but indicators now hint at a possible onset of a consolidation period.

The daily Relative Strength Index (RSI) remains within the oversold domain, currently registering a value of 2r which indicates persistent selling pressure. Furthermore, the Moving Average Convergence Divergence (MACD) continues to print flat red bars, underlining the bearish outlook. Nevertheless, given the recent southward journey of the RSI, there may be a corrective momentum in the making.

NZD/USD daily chart

A significant batch of support remains at the May lows around the 0.5880-0.5870 range. On the other hand, resistance levels were identified at the previous support value of 0.6000, followed by the 0.6050 mark. Should the sellers breach that area, the pair could slip to yearly lows while buyers could use that support to gear up for the next upwards leg.