Overview:
NZD/USD is expected to consolidate with the bullish bias after hitting a three-year high at 0.8805 on Tuesday. Kiwi sentiment is boosted after Fitch revised New Zealand's credit outlook to positive from stable as it affirms the nation's "AA" rating. NZD/USD is also supported by the weaker dollar sentiment and the hawkish monetary policy stance of the Reserve Bank of New Zealand as well as NZD-USD interest differential. But NZD/USD upside is limited by the Kiwi sales on soft NZD/JPY cross amid increased investor risk aversion. The daily chart is positive-biased as MACD is bullish, stochastics is reverted to the bullish mode near the overbought zone; five-day moving average turned upward above advancing 15-day MA.
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 0.8835 and the second target at 0.8835. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 0.8710. A break of this target would push the pair further downwards and one may expect the second target at 0.8680. The pivot point is at 0.8735.
Resistance levels:
0.8835
0.8860
0.8880
Support levels:
0.8735
0.8710
0.8680
The material has been provided by InstaForex Company - www.instaforex.com
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