Overview:
NZD/USD is expected to consolidate in a higher range after hitting its three-week low at 0.8514 on Tuesday as markets await the FOMC announcement. NZD/USD is supported by a 8.3% increase in New Zealand building consents issued in March, kiwi demand on buoyant NZD/JPY cross amid positive risk appetite, kiwi demand on retreating AUD/NZD cross, soft dollar sentiment and NZD-USD interest differential. But the NZD/USD gains are tempered by the concerns over China's economy. Daily chart is mixed as MACD is bearish, five-day moving average is below 15-day MA and is declining, but stochastics is turning bullish at oversold zone.
Trading recommendation:
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As far as the price is above its pivot point, a long position is recommended with the first target at 0.8615 and the second target at 0.8650. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 0.8475. A breach of this target will push the pair further downwards and one may expect the second target at 0.8430. The pivot point is at 0.8515.
Resistance levels:
0.8615
0.8650
0.8690
Support levels:
0.8475
0.843
0.84
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