FX.co ★ Technical analysis of NZD/USD for May 03, 2016

Overview:

• The NZD/USD pair movement was debatable as it took place in a narrow sideways channel for a while. The market showed signs of instability. According to the previous events, the price is still moving between the levels of 0.7056 and 0.6959. The daily resistance and support are seen at the levels of 0.7056 and 0.7088 respectively. In consequence, it is recommended to be cautious while placing orders in this area. Thus, we should wait until the sideways channel has completed. The price spot of 0.7050 remains a significant resistance zone. Therefore, there is a possibility that the NZD/USD pair will move to the downside and the fall structure does not look corrective. The price spot of 0.6747 remains a significant resistance zone. Therefore, there is a possibility that the NZD/USD pair will move to the downside and the fall structure does not look corrective. So, sell below 0.7050 with the first target at 0.6960. In overall, we still prefer the bearish scenario as long as the price is below the level of 0.7050. Furthermore, if the NZD/USD pair is able to break out the bottom at 0.6960, the market will decline further to 0.6914. However, it would also be safe to consider where to place a stop loss; this should be set above the second resistance of 0.7075.