NZD/USD is to consolidate after hitting one-month low of 0.8357 Wednesday. Kiwi sentiment hurt after Reserve Bank of New Zealand Gov. Wheeler revealed to a parliamentary committee that the central bank had intervened in the foreign exchange market to try to pare down the Kiwi’s strength-the first time the Reserve Bank had publicly admitted to intervening to weaken its currency since 2007. But Kiwi sentiment soothed by lower-than-expected New Zealand 1Q unemployment rate (came in at 6.2% vs 6.9% forecast). NZD/USD downside also limited by firmer commodity prices; NZD-USD yield gap; positive global risk sentiment. Kiwi vulnerable to 0130 GMT China April CPI, PPI data.Daily chart still negative-biased as MACD & stochastics bearish; five-day moving average staging bearish crossover against 15-day MA.
The pair is trading above its pivot point. It is likely to trade in higher range as far as it remains above its pivot point. As far as the price is above its pivot point, trading in higher range is most favourable and buy position is recommended above its pivot with the first target at 0.8585 and the second target at 0.8642. You should keep in view short position below the pivot keep of the first target at 0.851, the breach of this target will move the pair downward further and expect the second target at 0.8458. The pivot point stands at 0.855.
R1 – 0.8495
R2 – 0.8523 (Tuesday’s high)
R3 – 0.8556 (Monday’s high)
S1 – 0.8357 (Wednesday’s low)
S2 – 0.8323 (March 25 low)
S3 – 0.8282 (200-day moving average)
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