EURNZD has been stuck inside a long-term range, with support at the 1.6700 major psychological mark and resistance at 1.7300. Price just bounced upon hitting the top of the range and could be due for a move back to support from here.

New Zealand just released its quarterly CPI figure, which was a touch below consensus of 0.5% since it landed at 0.4%. However, the core inflation measure is up from 1.6% to 1.7% on a year-over-year basis, enough to revive RBNZ tightening hopes.

In that case, EURNZD could make it all the way down to the range support or at least halfway through at the mid-channel area of interest near 1.7000. This is also within the moving averages’ dynamic inflection points.

On the subject of moving averages, the 100 SMA is still above the longer-term 200 SMA to indicate that the path of least resistance is to the upside. This suggests that resistance is more likely to break than to hold. However, the gap between the two has narrowed enough to signal a possible bearish crossover.

In addition, RSI is turning lower to signal that sellers have the upper hand and EURNZD could follow suit. Stochastic has a bit more room to slide before hitting oversold conditions, which means that selling pressure could stay in play for a while.

Keep in mind, however, that there’s some support for the euro on account of ECB tightening expectations as well. Only the final CPI readings are due this week and negative revisions might be enough to douse rate hike forecasts.

The euro also tends to draw strength from dollar weakness since it serves as a safe-haven of sorts in trade-related scenarios. After all, the EU might strike a deal with China if relations with the US don’t improve. In contrast, the Kiwi tends to lose ground on trade tensions as lower demand for China’s goods could weigh on its output.