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    Technical analysis of NZD/USD for May 05, 2016 2016-05-05

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    Overview:

    • The NZD/USD pair movement was debatable as it took place in a narrow sideways channel this week. The market showed signs of instability. Amid the previous events, the price is still trapping between the levels of 0.6950 and 0.6814. The daily resistance and support are seen at the levels of 0.6950 and 0.6814 respectively. In consequence, it is recommended to be cautious while placing orders in this area.Thus, we should wait until the sideways channel is completed. So, the strong support has been already faced at the level of 0.6814 and the pair is likely to try to approach it in order to test it again and form a double bottom. If the pair succeeds in passing through the level of 0.6814, the market will indicate a bearish opportunity below the level of 0.6814. A breakout of that target will move the pair further downwards to 0.6756. Sell orders are recommended below the area of 0.6950 or 0.6814 with the first target at the level of 0.6756, and continue towards 0.6687. On the other hand, if the NZD/USD pair fails to break out through the resistance level of 0.6950, then this scenario may be invalidated. Overall, we still prefer the bearish scenario.

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