NZD/USD is expected to trade in a lower range as the resistance is at 0.6980. Although the pair posted a rebound from 0.6925 (the previous low), the pair is still trading below its key resistance at 0.6980, which should limit the upside potential. The descending 50-period moving average is playing a resistance role. Even though a continuation of the technical rebound cannot be ruled out, its extent should be limited.
To conclude, as long as 0.6980 is not surpassed, look for a further drop to 0.6915 and even to 0.6890 in extension.
The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 0.6915. A break below this target will move the pair further downwards to 0.6890. The pivot point stands at 0.6980. If the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 0.7005 and the second one at 0.7035.
Resistance levels: 0.6990, 0.7005, and 0.7020
Support levels: 0.6935, 0.6915, and 0.6870
The material has been provided by InstaForex Company – www.instaforex.com