Fundamental overview:
NZD/USD is expected to trade in a range. It is supported by the Kiwi demand on buoyant NZD/JPY cross amid the positive risk sentiment and firmer commodity prices. But NZD/USD upside is limited by the positive dollar sentiment (VIX fear gauge eased 6.43% to 20.95; S&P 500 closed up 1.34% at 2,019.42 Friday) on stronger-than-expected rise in University of Michigan preliminary consumer sentiment index to decade-high 98.2 in January from final December reading of 93.6 (versus forecast 94.4), while a 0.8% on-year rise in U.S. December CPI for the slowest annual rise since October 2009 stoke expectations that the Federal Reserve could delay raising interest rates and Kiwi sales on buoyant AUD/NZD cross.
Technical comment:
Daily chart is mixed as MACD and stochastics are in a bullish mode, but five- and 15-day moving averages are meandering sideways, the inside-day-range pattern was completed on Friday.
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 0.7825 and the second target at 0.7865. In an alternative scenario, if the price moves below its pivot points, short posisitions are recommended with the first target at 0.7720. A break of this target would push the pair further downwards and one may expect the second target at 0.7690. The pivot point is at 0.7755.
Resistance levels:
0.7825
0.7865
0.79
Support levels:
0.7720
0.7690
0.7650
The material has been provided by InstaForex Company - www.instaforex.com
