NZD/USD is under pressure and is expected to extend losses. The pair recorded a succession of lower tops and lower bottoms since July 13 and is heading downward. The declining 20-period and 50-period moving averages are playing resistance roles and maintain the downside bias. Besides, the relative strength index broke below its 30 level. To conclude, as long as 0.7215 holds on the upside, look for further drop toward 0.7115 and 0.7095 in extension.
Recommendation:
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 0.7115. A break below this target will move the pair further downwards to 0.7095. The pivot point stands at 0.7215. 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 0.7250 and the second one, at 0.7270.
Resistance levels: 0.7250, 0.7270, 0.7310
Support levels: 0.7115, 0.7095, 0.7035
The material has been provided by InstaForex Company - www.instaforex.com