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26 Apr 2013
Forex: Kiwi takes another leg up but closes well off highs of day
FXstreet.com (Barcelona) - The Kiwi finished the day up 23 pips at 0.8497. Early in the US session, the pair traded as high as 0.8562 but was unable to maintain a bid at higher levels and drifted lower much of the afternoon. Market participants will be monitoring the New Zealand Trade Balance figures due out later in the Asia session at 6:45GMT
According to Mike Jones of BNZ, “The ever-brighter glow of the kiwi’s relative growth and interest rate appeal has been largely responsible for the currency’s recent gains. Not only are investors worried about a slowing pace of growth in the US and Europe, but Wednesday’s morning’s RBNZ statement reinforced to the market the relatively upbeat NZ outlook.” He went on to add, The Bank’s comment that growth “has picked up”, alongside it’s ”projection for inflation to gradually rise” has further dimmed the chances of RBNZ rate cuts in the eyes of the market.
The short term moving averages on the daily chart remain bullish with price closing above both the upward sloping 9 and 20 dma’s. The RSI (14) is now approaching 60 which is an important resistance level keep an eye on. A move through here could propel additional momentum buying. First resistance sits at 0.8526 (the 20dma on 1 hour chart), 0.8562 (shooting star candle high on 1 hour chart). Initial support is at 0.8489 (the 45dma on 1 hour chart), followed by 0.8462 (the 20dma on daily chart)
According to Mike Jones of BNZ, “The ever-brighter glow of the kiwi’s relative growth and interest rate appeal has been largely responsible for the currency’s recent gains. Not only are investors worried about a slowing pace of growth in the US and Europe, but Wednesday’s morning’s RBNZ statement reinforced to the market the relatively upbeat NZ outlook.” He went on to add, The Bank’s comment that growth “has picked up”, alongside it’s ”projection for inflation to gradually rise” has further dimmed the chances of RBNZ rate cuts in the eyes of the market.
The short term moving averages on the daily chart remain bullish with price closing above both the upward sloping 9 and 20 dma’s. The RSI (14) is now approaching 60 which is an important resistance level keep an eye on. A move through here could propel additional momentum buying. First resistance sits at 0.8526 (the 20dma on 1 hour chart), 0.8562 (shooting star candle high on 1 hour chart). Initial support is at 0.8489 (the 45dma on 1 hour chart), followed by 0.8462 (the 20dma on daily chart)