NZD/USD is likely to extend a downside movement. The pair is showing strong downward momentum after the bearish breakout of a rising trend line since September 30. In addition, the process of lower highs and lower lows remains intact, which should confirm a negative outlook. Besides, the descending 50-period moving average is playing a resistance role. In addition, the relative strength index broke below its 30 level. To sum up, as long as 0.7250 holds on the upside, the pair is likely to drop to 0.7155 at first, and then to 0.7130 in extension.
The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 0.7155. A break below this target will move the pair further downwards to 0.7130. The pivot point stands at 0.7250. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 0.7300 and the second one at 0.7330.
Resistance levels: 0.7300, 0.7330, 0.7350
Support levels: 0.7155, 0.7130, 0.7095
The material has been provided by InstaForex Company - www.instaforex.com