NZD/USD is expected to trade with a bearish bias as key resistance at 0.7290. The pair failed to break above the nearest resistance at 0.7290, and remains under pressure below this level. The 50-period moving average is badly directed and should limit the upward potential. Even though a continuation of the technical rebound cannot be ruled out, its extent should be limited. On Tuesday, U.S. indices closed lower weighted down by shares in the Utilities, Consumer Durables & Apparel and Retailing sectors. The Dow Jones Industrial Average dropped 49 points (0.2%) to 18454, the S&P 500 slipped 4 points (0.2%) to 2176, and the Nasdaq Composite dipped 9 points (0.2%) to 5223. To conclude, as long as 0.7290 is not broken up, the intraday outlook remains bearish with a down target at 0.720. A break below this level would open the way to further weakness toward the next support at 0.7160.
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 0.7200. A break of this target will move the pair further downwards to 0.7160. The pivot point stands at 0.7290. In case 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 0.7340 and the second one, at 0.7380.
Resistance levels: 0.7340, 0.7380, 0.7410
Support levels: 0.7200, 0.7160, 0.7120
The material has been provided by InstaForex Company – www.instaforex.com