FX.co ★ Technical analysis of NZD/USD for October 21, 2016

NZD/USD is under pressure. The pair shows further downside potential after its downward breakout of a rising trend line (since Oct 18), which confirms a negative view. The declining 20-period and 50-peirod moving averages are playing resistance roles and maintain the downside bias. The relative strength index is capped by a bearish trend line, which emerged on Oct 18, and is below its neutrality level at 50. As long as 0.7205 holds on the upside, look for a further drop toward 0.7125 and 0.7095 in extension.

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 0.7125. A break below this target will move the pair further downwards to 0.7095. The pivot point stands at 0.7205. 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 0.7230 and the second one at 0.7250.

Resistance levels: 0.7230, 0.7250, 0.7280

Support levels: 0.7125, 0.7095, 0.7070