Fundamental Overview:
NZD/USD is expected to consolidate with a bearish bias after hitting a 13-month low 0.7707 on Monday. Kiwi is hurt after Reserve Bank of New Zealand revealed it has sold a net NZ$521 million in August versus just NZ$2 million in July, suggesting that the central bank had intervened to weaken the currency and Prime Minister John Key was reported as signaling that US$0.6500 would be a fair value for the Kiwi. NZD/USD is also weighed by the positive dollar sentiment and waning investor risk appetite; Kiwi sales on cross trades versus major currencies.
Technical Comment:
Daily chart is negative-biased as MACD is bearish, stochastics stays suppressed at 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 0.7730. A break of this target will move the pair further downwards to 0.77. The pivot point stands at 0.7830. 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 0.7910 and the second target at 0.7955.
Resistance levels:
0.7910
0.7955
0.8035
Support levels:
0.7730
0.77
0.7675
The material has been provided by InstaForex Company - www.instaforex.com
