Overview:
NZD/USD is consolidating with risks skewed higher after hitting six-month low of 0.8003 on Thursday. The rate is supported by negative U.S. dollar sentiment, improved investor risk appetite; residual month-end positions adjustment; NZD-USD yield gap. But NZD/USD gains limited as Reserve Bank of New Zealand Governor Graeme Wheeler said RBNZ will not immediately raise interest rates to curb rising house prices, and that the central bank might sell more currency to cool an appreciating kiwi that is making exports more expensive; fears Japan's FSA might impose new rules on foreign exchange margin trading (which would weigh on NZD/JPY cross); Kiwi sales on rebounding AUD/NZD cross; positions adjustment before weekend. Daily chart is mixed as MACD is bearish, but stochastics is turning bullish at oversold; possible tweezer-bottom candlestick pattern was completed on Thursday.
Trading recommendations:
The pair is trading below its pivot point. The pair is likely to trade in lower range as far as it remains below its pivot point. Short position is recommended with the first target at 0.8005 in view, breach of this target will move further the pair downward and you should expect the second target at 100.55. Pivot point stands at 0.796. In case the price moves in opposite direction and returns from its support and moves above its pivot point, then trading in higher range is the most favorable and buy position is recommended above its pivot with the first target at 0.812 and the second target at 0.814.
Resistance levels:
R1 - 0.812
R2 - 0.814
R3 - 0.816
Support levels:
S1 - 0.8005
S2 - 0.796
S3 - 0.794
