NZD/USD is expected to trade in a higher range as the bias remains bullish. The pair is holding on the upside after a rebound from its key support at 0.7220 (Aug 31 & Sept 1 bottoms) which should limit the downside potential. The upward momentum is further reinforced by its rising 50-period moving average which acts as a support role and maintains the upside bias. In addition, the relative strength index rebounded from its 30 level and lacks downward momentum. To conclude, as long as 0.7220 holds on the downside, look for further advance to 0.7325 and even to 0.7340 in extension.
The pair is trading above its pivot point. It is likely to trade in a wider range as long as it remains above its pivot point. Therefore, long positions are recommended with the first target at 0.7325 and the second one at 0.7340. In the alternative scenario, short positions are recommended with the first target at 0.7200 if the price moves below its pivot points. A break of this target is likely to push the pair further downwards, and one may expect the second target at 0.7160. The pivot point is at 0.7220.
Resistance levels: 0.7325, 0.7340, 0.7375
Support levels: 0.7200, 0.7160, 0.7120
