Fundamental overview:
NZD/USD is expected to consolidate with a bearish bias. It is undermined by the China growth worries and weak commodity prices. But NZD/USD downside is limited by the NZD-USD interest differential, softer USD sentiment (ICE spot dollar index last 88.15 versus 88.41 early Monday) after lower Markit flash U.S. November services PMI of 56.3 versus final October reading of 57.1, drop in Chicago Fed National Activity Index to +0.14 in October from +0.29 in September and Kiwi demand on buoyant NZD/JPY cross amid the positive risk sentiment and Kiwi demand on soft AUD/NZD cross.
Technical Comment:
Daily chart is mixed as MACD is bullish, but stochastics is in bearish mode.
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 0.7760. A break of this target will move the pair further downwards to 0.7735. The pivot point stands at 0.7840. In case the price moves in the opposite direction and bounces back from the support level, then it will move 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 0.7885 and the second target at 0.7910.
Resistance levels:
0.7885
0.7910
0.7945
Support levels:
0.7760
0.7735
0.77
The material has been provided by InstaForex Company - www.instaforex.com
