NZD/USD is expected to consolidate with bearish bias after hitting a 4.5-year low of 0.7065 on Monday. NZD/USD is undermined by the improved dollar sentiment and speculation that the Reserve Bank of New Zealand would cut interest rates in the coming months. But NZD/USD losses are tempered by the improved investor risk appetite, NZD-USD interest differential, and kiwi demand on the retreating AUD/NZD cross.
The daily chart is negative-biased as the MACD is bearish, stochastics stays suppressed at oversold levels, 5 and 15-day moving averages are falling.
The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. As long as the price holds above its pivot point, long positions are recommended with the first target at 0.7210 and the second target at 0.7270. In the alternative scenario, short positions are recommended with the first target at 0.7050 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 0.7030. The pivot point is at 0.7095.
Resistance levels: 0.7210 0.7270 0.73
Support levels: 0.7050 0.7030 0.7
The material has been provided by InstaForex Company – www.instaforex.com