Overview:
NZD/USD is expected to trade with risks skewed lower. It is undermined by the improved dollar sentiment, Kiwi sales on NZD/JPY cross amid increased investor risk aversion and concerns about the growth outlook in China. But NZD/USD losses are tempered by the hawkish Reserve Bank of New Zealand's monetary policy stance and Kiwi demand sales on soft AUD/NZD cross. Daily chart is mixed as five and 15-day moving averages are advancing, but stochastics turned bearish at overbought zone.
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. Short position is recommended with the first target at 0.8625. A breach of this target will move the pair further downwards to 0.8610. The pivot point stands at 0.8690. In case the price moves in the opposite direction and bounces back from support level, and then it moves 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 0.8625 and the second target at 0.8610.
Resistance levels:
0.8725
0.8745
0.8780
Support levels:
0.8625
0.8610
0.8570
