NZD/USD is expected to extend its upside movement. The pair has been supported by a rising trend line since June 28 and is likely to challenge the horizontal resistance at 0.7155 in sight. Meanwhile, both the 20-period and 50-period moving averages are playing support roles. Besides, the relative strength index lacks downward momentum. Further upside is therefore expected with the next horizontal resistance at 0.7155 at first. A break above 0.7130 would trigger a new bounce toward 0.7155. Alternatively, only a break below the horizontal support at 0.7075 could bring a pullback toward 0.7040 and 0.7015 as targets.
Recommendation:
The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. Therefore, long positions are recommended with the first target at 0.7130 and the second one, at 0.7155. In the alternative scenario, short positions are recommended with the first target at 0.7040 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 0.7015. The pivot point is at 0.7055.
Resistance levels: 0.7130, 0.7155, 0.72
Support levels: 0.7040, 0.7015, 0.6980
The material has been provided by InstaForex Company - www.instaforex.com