The NZD/USD pair fell slightly during the session on Friday, but found support yet again near the 0.82 level. This area has been supportive over the last several weeks, and I think it will be a bit tough to break down below at this point. The markets have been fairly content to hang about the area, and it could find itself getting comfortable in the region yet again.
It is because of this that I think the market could be a bit of a “buy only” market. Simply put, the New Zealand dollar has had a bit of a bid in it, but it seems to be more of a short-term trader’s type of market, as the 0.85 level seems to be a bit too resistive. Going forward, I think you could make decent money on this move, as it looks fairly solid, but I would also mention that the overall attitude for the longer-term market is positive. With that in mind, I think that we will eventually break out to the upside, and onto the 0.90 handle.
Taper? Or maybe not….
The Federal Reserve will have the jobs number to look forward to this week. It is this number that will determine more than anything what they can do about the bond buyback program, and how quickly. I find it difficult to believe that the jobs number is going to be overly impressive, and because of this I believe the Dollar will get hit over the long term. This market will more than likely react in a very positive manner to this, even though there was a hint that the Federal Reserve is still open to the idea of tapering in December. This is a bit of a pipedream though, as the employment situation in America is stable, but not really getting much better. The breaking of the 0.82 level would be a bit of a surprise, and I think at that point the market would look for the 0.80 level in the short-term, where it would find a lot of buying pressure.
