The NZD/USD pair went back and forth during the course of the day on Monday, essentially settling nothing. The one thing that we did see during the day was that the 0.7450 level looks to be a bit supportive. I don’t really like the New Zealand dollar right now, but I am the first to admit that we may see a little bit of a bounce. I think this ultimately will be a nice selling opportunity, as the New Zealand dollar is highly leveraged to commodity markets which of course looks horrible in general right now.
I also like the US dollar in general, so I think ultimately this pair does break down. However, around the Forex world right now it looks as if the US dollar might get a little bit of a breather from the buying pressure over the next session or two. The US Dollar Index formed a shooting star, albeit at the 100 level like you would anticipate. I think this is a short-term phenomenon though, and I believe that it’s only a matter of time before the US dollar comes back again.
0.72 or lower.
I believe that this market goes to the 0.72 level or possibly even lower given enough time. I also believe that the New Zealand dollar will continue to suffer at the hands of not only poor commodities, but the fact that in general the world is not exactly ready to take on the whole lot of risk. I think that ultimately this pair does break down but I am perfectly comfortable sitting on the sidelines and waiting for a selling opportunity. I would love to sell a resistive candle somewhere close to the 0.77 handle, and believe that the 0.80 handle above is the absolute ceiling in this market right now. Ultimately, it’s only a matter of time before we sell off, and therefore I am just simply looking for either resistive candles above, or a break of the range from Monday, either will do.
