NZD/USD is expected to trade in a lower range. It is undermined by the higher-than-expected New Zealand Q1 unemployment rate of 5.8% (versus forecast 5.5%); 3.5% drop in Fonterra's GDT Price Index, 1.8% fall in average price for whole milk powder to $2,386/mt at latest Global Dairy Trade auction, increased risk aversion, and kiwi sales on buoyant AUD/NZD cross. But NZD/USD losses are tempered by weaker USD sentiment and NZD-USD interest differential.
The daily chart is negative-biased as the MACD and stochastics are bearish, 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 0.7415. 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 0.7460 and the second target at 0.75.
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