NZD/USD is expected to consolidate with a bearish bias. It is undermined by the comment from Reserve Bank of New Zealand that it will keep investigating the use of macroprudential tools to control the housing market. NZD/USD is also weighed by kiwi sales on buoyant AUD/NZD, decreased investor risk appetite, divergent Reserve Bank of New Zealand-Federal Reserve monetary policy stances, and lower dairy prices. But kiwi sentiment is boosted by surprising New Zealand May trade surplus of NZ$350 million (versus forecast for NZ$100 million deficit). NZD/USD downside is also limited by the positions adjustment ahead of the weekend.
The daily chart is mixed as five- and 15-day moving averages are declining but stochastics is bullish at oversold levels.
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 0.6850. A break of that target will move the pair further downwards to 0.6815. The pivot point stands at 0.6920. 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 0.6950 and the second target at 0.6980.
Resistance levels: 0.6950 0.6980 0.6915
Support levels: 0.6850 0.6815 0.6770
The material has been provided by InstaForex Company – www.instaforex.com