Overview:
NZD/USD is expected to trade in a lower range. It is undermined by the Kiwi sales on soft NZD/JPY cross amid the increasing investor risk aversion, the positive dollar sentiment and weak dairy prices. But NZD/USD losses are tempered by the Kiwi demand on soft AUD/NZD cross, NZD-USD interest differential, and adjustment of positions before the weekend. Kiwi is vulnerable to China July trade balance data. The daily chart is negative-biased as MACD is bearish, stochastics stays suppressed in the oversold zone; five and 15-day moving averages are declining.
Trading recommendations:
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 long as the price is keeping above its pivot point, a long position is recommended with the first target at 0.8375 and the second target at 0.8350. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 0.8505. A break of this target would push the pair further downwards and one may expect the second target at 0.8530. The pivot point is at 0.8420.
Resistance levels:
0.8505
0.8530
0.8560
Support levels:
0.8375
0.8350
0.8315
