NZD/USD is expected to consolidate with bearish bias after hitting almost a five-year low of 0.6813 on Tuesday if 0.6874 cap holds. NZD/USD is undermined by the bullish dollar sentiment, dovish monetary stance of the Reserve Bank of New Zealand, soft dairy prices, and kiwi sales on the buoyant AUD/NZD cross. But NZD/USD losses are tempered by the kiwi demand on the buoyant NZD/JPY cross amid receding risk aversion, on the soft EUR/NZD and GBP/NZD crosses, and on the buoyant NZD/CHF cross.
The daily chart is negative-biased as the MACD is bearish, stochastics stays suppressed at oversold levels. Five- and 15-day moving averages are declining.
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 0.6830. A break of that target will move the pair further downwards to 0.68. The pivot point stands at 0.6875. 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 0.69 and the second target at 0.6930.
Resistance levels: 0.69 0.6930 0.6970
Support levels: 0.6830 0.68 0.6770
The material has been provided by InstaForex Company – www.instaforex.com