Fundamental Overview:
NZD/USD is expected to consolidate with a bullish bias before FOMC decision. Market participants are watching out for subtle adjustments in the way the Fed describes its outlook on policy that could signal earlier hikes to the Fed's key policy rate than the widely-expected mid-2015. It is supported by the broadly softer USD undertone, the positive investor risk sentiment and Fonterra's GDT Price Index unchanged at latest Global DairyTrade auction held overnight. But the NZD sentiment are dented by the wider-than-expected New Zealand 2Q current account deficit of NZD1.1 billion (versus forecast NZD0.95 billion).
Technical Comment:
The daily chart is mixed as MACD is bearish, 5 and 15-day moving averages are falling, but stochastics is turned bullish at the oversold zone, bullish parabolic stop-and-reverse signal hit on Tuesday.
Trading recommendations:
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As long as the price is keeping above its pivot point, a long position is recommended with the first target at 0.8230 and the second target at 0.8265. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 0.8120. A break of this target would push the pair further downwards and one may expect the second target at 0.8075. The pivot point is at 0.8140.
Resistance levels:
0.8230
0.8265
0.8305
Support levels:
0.8120
0.8175
0.8135
The material has been provided by InstaForex Company - www.instaforex.com
