FX.co ★ Technical analysis of NZD/USD for May 14, 2014

Overview:

NZD/USD is expected to range-trade. It is supported by the Kiwi demand on NZD/JPY cross amid diminished risk aversion. But Kiwi sentiments are dented by the weaker-than-expected New Zealand 1Q retail sales, RBNZ's Financial Stability Report saying that New Zealand's financial system remains sound, but risks remain from the overvalued house prices and high levels of debt in the household sector. NZD/USD upside is also limited by the broadly stronger USD undertone. Daily chart is mixed as MACD is bearish, but stochastics is turning neutral.

Trading recommendation:
The pair is trading above its pivot point. It is likely to trade in a higher range as far as it remains above its pivot point. As far as the price is above its pivot point, a long position is recommended with the first target at 0.8710 and the second target at 0.8745. In an alternative scenario, if the price moves below its pivot points, short positions are recommended with the first target at 0.8595. A breach of this target will push the pair further downwards and one may expect the second target at 0.8545. The pivot point is at 0.8620.

Resistance levels:
0.8710
0.8745
0.8780

Support levels:
0.8595
0.8545
0.8525