By: DailyForex.com
The NZD/USD pair fell during the session on Wednesday, and even managed to crack below the 0.82 level. This pair has been grinding up words for some time now, and quite frankly has been far too messy for me to be involved with. However, judging by the size of the candle for Wednesday I believe that this pair should continue to fall.
This isn't to say that this will be a quick move lower, as there are quite a few support levels below. I do believe that the 0.80 level will be a significant area as well, so any fall will more than likely struggle at that point time.
The Kiwi dollar will certainly follow whatever happens in the commodity markets. As with all of the uncertainty out there, it would not be surprising to see continued weakness in several of them as traders simply do not know what to do with their money right now. Going forward, I expect a ton of volatility in the marketplace and in all markets generally speaking. With this in mind, the New Zealand dollar will certainly get thrown around back and forth.
Short Time Frames
Because of the choppiness that we've seen in this currency pair over the last several weeks, I believe that the best way to trade it will be to continuously short it on every bounce. I would use short-term time frame charts, and smaller than usual positions. This allows you to take advantage of the fall as it comes, but it won't be a clean break.
Looking forward, I believe the 0.80 level will be the first significant bounce that will more than likely happen, and because of that I would be willing to be flat of this market at that point time. Taking profits in an environment like we have lately would certainly not be a mistake as we've had trouble finding a direct move from one direction to another. Because of this, I believe that this pair especially will be short-term, but in reality many pairs out there will be. There is a lot of uncertainty out there right now, and as such is will be a dangerous and volatile pair, but certainly biased to the downside.