NZD/USD is expected to trade in a lower range. The pair reversed down following the break below its horizontal support at 0.6680, which now acts as a resistance. Both the 20-period and 50-period moving averages are turning down, calling for a new drop. The relative strength index is badly directed, which indicates that the bearish momentum is still strong. To sum up, as long as 0.6680 is not surpassed, a new pullback seems to be on the cards to 0.6565 and 0.6525.
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 0.6565. A break of this target will move the pair further downwards to 0.6525. The pivot point stands at 0.6680. 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 0.6725 and the second target at 0.6755.
Resistance levels: 0.6725, 0.6755, 0.6775
Support levels: 0.6565, 0.6525, 0.650
The material has been provided by InstaForex Company - www.instaforex.com