The NZD/USD pair had a back and forth session during Tuesday, but considering where we are that was actually a fairly strong showing. After all, we are just below the 0.85 handle, an area that has kept this pair down for some time. Looking at this chart though, it does appear that the momentum is building towards the upside, it is only a matter time before we breakout.
Actually, as I look at this chart I cannot help but notice that the 0.84 level itself seems to be offering support. The candle shape doesn't really tell me much, but I do see a lot of noise between 0.84 and 0.83 or so, and this makes me believe that there are a lot of people willing to step in and buy this pair down in that region. With that being the case, this pair really doesn't have a whole lot of room to move as far as selling off.
0.85 opens the way to 0.90
If we can get above the 0.85 handle, I believe that we will move to the 0.90 handle in the short term. In fact, I look at this chart as one big consolidation area between 0.80 and 0.85, and because of this we should get as high as 0.90 in relatively short order. Looking this chart, it's obvious that every time we fall people were stepping in to buy this pair. This screams to me that there is more than enough buying pressure to push this pair higher.
Interestingly enough, the Australian dollar is looking fairly weak while the New Zealand dollar seems to be fairly strong. It's interesting that this pair just refuses the fall while its cousin across the Tasman seems to have serious problems. Looking at this chart, I do think that we will eventually breakout, but it's going to take some type of headline to get the ball moving. In the long run though, I do believe that the Federal Reserve and its money printing machines will overcome the market, and push all commodity currencies higher.