NZD/USD is expected to trade in a lower range . The pair broke below its intraday trading range pattern yesterday, and accelerated on the downside. The 20-period moving average also crossed below the 50-period one, and should act as a strong resistance to push the prices lower. Besides, the relative strength index is badly directed without showing any signals of reversal. To sum up, as long as 0.6540 (our trailing stop loss) is not surpassed, a decline to 0.6450 and 0.6400 should be expected.
Trading recommendations:
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 0.6450. A break of that target will move the pair further downwards to 0.64. The pivot point stands at 0.6540. 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 0.6585 and the second target at 0.6635.
Resistance levels: 0.6585, 0.6635, 0.6675
Support levels: 0.6450, 0.64, 0.6365
The material has been provided by InstaForex Company - www.instaforex.com