NZD/USD is expected to go on with its upside movement. The pair broke above its 20-period and 50-period moving averages with strong momentum and is heading upwards. In addition, 0.7180 (Aug 9 peak and 10 bottom) represents a significant key support level, which should limit the downside potential. The pair broke above the upper boundary of the Bollinger band, which could signal a continuation of bullish trend. The relative strength index is bullish above its neutrality area at 50 and calls for a new upleg. As long as 0.7180 holds on the downside, look for further rise toward 0.7340 and 0.7380 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 0.7340 and the second one, at 0.7380. In the alternative scenario, short positions are recommended with the first target at 0.7145, 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 0.7105. The pivot point is at 0.7180.
Resistance levels: 0.7340, 0.7380, 0.7450
Support levels: 0.7145, 0.7105, 0.7065
The material has been provided by InstaForex Company – www.instaforex.com