Overview:
NZD/USD is going to range-trade undermined by contagion from weak Aussie, jawboning on Kiwi strength from the Reserve Bank of New Zealand's officials, Kiwi sales on soft NZD/JPY cross. But Kiwi's sentiment is soothed by narrower-than-expected New Zealand October trade deficit of NZ$168 million (versus forecast NZ$350 million deficit). NZD/USD downside is also limited by Kiwi demand on soft AUD/NZD cross, weaker dollar sentiment, and NZD/USD interest differential. Daily chart is mixed as MACD is bearish, five-day moving average is below 15-day MA and falling; but stochastics is turning bullish near oversold.
Trading recommendation:
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. A short position is recommended with the first target at 0.809 in view; a breach of this target will move the pair further downwards to 0.805. The pivot point stands at 0.84. In case the price moves in the opposite direction, bounces back from support, and moves above its pivot point, the price is most favorably expected to move further to the upside. In that scenario a long position is recommended with the first target at 0.83 and the second target at 0.835.
Support levels:
0.809
0.805
0.801
Resistance levels:
0.83
0.835
0.8380
