NZD/USD is expected to consolidate with bearish bias after hitting a five-week low of 0.7410 this morning. It is undermined by the kiwi sales on buoyant AUD/NZD cross and weak dairy prices. But NZD/USD downside is limited by softer dollar sentiment, positive investor risk appetite, and NZD-USD interest differential.
The daily chart is negative-biased as the MACD and stochastics are bearish, although the latter is at oversold levels, five-day moving average is below 15-day moving average and is 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 0.7340. A break of that target will move the pair further downwards to 0.73. The pivot point stands at 0.7460. 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 0.7515 and the second target at 0.7550.
The material has been provided by InstaForex Company – www.instaforex.com