NZD/USD is expected to trade in a lower range. The pair is reversing downwards after breaking below its previous support at 0.6390, which should now act as resistance. A double top pattern has been validated, calling for intraday trend reversal. The descending 50-period intraday MA maintains a bearish bias. Moreover, the intraday RSI remains below its 50% neutrality area and is capped by declining trend line. The first target to the downside is therefore set at 0.6285. A break below this level would open the way to further weakness towards the horizontal support and overlap at 0.6240. Only a break above the key resistance at 0.6390 would call for further upside.
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 0.6285. A break of that target will move the pair further downwards to 0.6240. The pivot point stands at 0.390. 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 0.6430 and the second target at 0.6470.
Resistance levels: 0.6430 0.6470 0.6505
Support levels: 0.6285 0.6240 0.62
The material has been provided by InstaForex Company – www.instaforex.com