Fundamental Overview:
NZD/USD is expected to consolidate with a bearish bias after hitting one-year low at 0.7908 on Thursday. It is hurt by the comments from the Reserve Bank of New Zealand that the Kiwi's real exchange rate is still above sustainable levels, and that experience shows that the ultimate adjustment can be large when the Kiwi starts to fall. NZD/USD is also weighed by the positive dollar sentiment and Kiwi sales on soft NZD/JPY cross amid increased investor risk aversion and Kiwi sales on buoyant AUD/NZD, EUR/NZD and GBP/NZD crosses. But NZD/USD losses are tempered by the positions adjustment before the weekend.
Technical Comment:
Daily chart is negative-biased as MACD is bearish, stochastics stays suppressed at the oversold zone, 5 and 15-day moving averages are falling.
Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. Short position is recommended with the first target at 0.7835. A break of this target will move the pair further downwards to 0.7805. The pivot point stands at 0.7975. In case the price moves in the opposite direction and bounces back from the support level, then it will moves above its pivot point. It is likely to move further to the upside. In that scenario, a long position is recommended with the first target at 0.8035 and the second target at 0.8095.
Resistance levels:
0.8035
0.8095
0.8145
Support levels:
0.7835
0.7805
0.7775
The material has been provided by InstaForex Company - www.instaforex.com
