FX.co ★ Technical analysis of NZD/USD for July 22, 2016

NZD/USD is under pressure as the key resistance is at 0.7040. The pair is posting some rebound, and the 50-period moving average is turning up. Nevertheless, the prices failed to break above the key resistance at 0.7040, and the upward potential is likely to be limited by the threshold. As long as 0.7040 holds as the key resistance, the pair is likely to return to 0.6950. A break below this level would open the way to further weakness toward the horizontal support at 0.6920.

Recommendation:

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 0.6950. A break below this target will move the pair further downwards to 0.6920. The pivot point stands at 0.7040. 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 0.7065 and the second one, at 0.7085.

Resistance levels: 0.7065, 0.7085, 0.7125

Support levels: 0.6950, 0.6920, 0.6875