NZD/USD: lifted by the RBNZ
NZD/USD retraced this week 50% of Oct.-Nov. decline at $0.8310. Then the pair went to test support at $0.8200 as the greenback gained on the US budget deal and the Fed’s tapering expectations. Then, however, kiwi got support as the Reserve Bank of New Zealand said that the current level of stimulus is becoming unnecessary as inflationary pressures loom. The RBNZ forecasts point to higher and earlier rate hikes in 2014 than its prior forecasts in September. Although the central bank may be concerned with strong NZD, it doesn’t seem willing to do anything about it.
NZD/USD remains inside the daily Ichimoku Cloud. Its upper border is currently at $0.8333 and acts as the main near-term resistance as well as 61.8% Fibo at $0.8366 and the $0.8400 handle. Support lies at $0.8250 and $0.8200. There are bullish developments from the technical point of view, but taking into account the risks associated with the Federal Reserve which meets next week, we’d like to wait until the price fixes above the Cloud to go long.
Chart. Dasily NZD/USD