Fundamental overview:
NZD/USD is expected to trade in a lower range. NZD sentiment is dented by the 1.1% drop in Fonterra's GDT Price Index at latest Global Dairy Trade auction. NZD/USD is also undermined by the positive dollar sentiment (ICE spot dollar index last 88.62 versus 87.98 early Tuesday) after Federal Reserve Vice Chairman Stanley Fischer said the central bank is getting closer to dropping the pledge of keeping interest rates low for a "considerable time"; stronger-than-expected 1.1% increase in U.S. October construction spending (versus forecast +0.6%) jump in U.S. ISM-NY current business index to 62.4 in November from 54.8 in October. But NZD/USD losses are tempered by the positive investor risk appetite and NZD-USD interest differential.
Technical Comment:
Daily chart is negative-biased as stochastics is bearish, MACD histogram bars are turning negative, five-day moving average is below 15-day moving average and is declining.
Trading recommendations:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. Short position is recommended with the first target at 0.7735. A break of this target will move the pair further downwards to 0.7710. The pivot point stands at 0.7810. In case the price moves in the opposite direction and bounces back from the support level, then it will move above its pivot point. It is likely to move further to the upside. In that scenario, a long position is recommended with the first target at 0.7855 and the second target at 0.7885.
Resistance levels:
0.7855
0.7885
0.7925
Support levels:
0.7735
0.7710
0.7675
The material has been provided by InstaForex Company - www.instaforex.com
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