NZD/USD got some strengh after the quarterly Employment Change was surprisingly good in New Zealand. NZD/USD now trades at 0.5080, making a quick leap.
Employment in New Zealand is comparably in a good shape. This rate is far from being the worst in the world, and still causes envy sights from other Western nations. And as expectations were somewhat lower than this figure, the kiwi is going up.
Since breaking the support line of 0.5150, the Kiwi fell as deep as 0.4962 and the corrected itself and tested the resistance line of…well yes, 0.5150. The kiwi tested this line 3 (!) times, and was throw backwards. After this employment data, this resistance line seems very firm, despite the leap seen here:
It all began last week, when the RBNZ lowered interest rates by a dramatic 1.5% to 3.5%, being temporarily lower than the Australian interest rate. At that time, the Kiwi was on the edge.
The break began on Friday, after the release of the Building Consents and the remarks by RBNZ Governor Bollard. The move downward continued on Sunday, in the wake of the forex trading week, with the release of the Labor Cost Index that was disappointing.Â
It’s fascinating to see how the kiwi plays by the book, and “respects†support / resistance lines. This “good†technical behavior makes this currency pair quite favorable in the currency pairs available for forex traders.
Will NZD/USD break the resistance line? I don’t think so. The data isn’t strong enough, and the resistance line is very strong.
