Overview:
NZD/USD is consolidating after hitting a near-one-month low of 0.8229 Tuesday, as markets wait for 18:00 GMT, when FOMC monetary policy decision comes and 20:00 GMT (9 am Thursday NZ time) Reserve Bank of New Zealand's official cash rate announcement: A Wall Street Journal poll of 14 economists unanimously sees RBNZ keeping rates on hold at the historic low of 2.5% with expectations that rates will begin rising in March next year. NZD/USD is undermined by concerns about tighter Chinese monetary policy; contagion from weaker Aussie. There is some apprehension that RBNZ Gov. Wheeler at Thursday meeting could follow RBA Gov. Stevens' lead after the latter jawboned the Aussie lower. But NZD/USD downside is limited by positive risk sentiment; Kiwi demand in the soft AUD/NZD cross. Daily chart is negative-biased as MACD and stochastics are bearish, although the latter at oversold; the 5-day moving average is below the 15-day MA and falling.
Trading recommendation:
The pair is trading below its pivot point. It is likely to trade in a lower range as far as it remains below its pivot point. A short position is recommended with the first target at 0.823 in view; a breach of this target will move the pair further downwards to 0.82. The pivot point stands at 0.833. In case the price moves in the opposite direction, bounces back from support, and moves above its pivot point, the price is most favorably expected to move further to the upside. In that scenario a long position is recommended with the first target at 0.84 and the second target at 0.844.
Support levels:
0.823
0.82
0.8175
Resistance levels:
0.84
0.844
0.849