- BK Asset Management (based on The New Zealand Herald)
On Friday, the Kiwi suffered substantial losses of 63 pips. The monthly PP failed to prevent the NZD/USD pair from declining, while the 55-day SMA succeeded. Technical indicators are now showing bullish signs; however, we expect the New Zealand Dollar to drop further down. We should not rule out a possibility of a hike, which has a solid chance to occur if the US fundamentals disappoint later in the evening. Gains should be limited by the 55-day SMA at 0.7543, a rather strong support cluster rests around 0.75.
Market sentiment remains bearish, with 72% of all positions being short (previously 74%). The buy orders are now in the majority, taking up 51% of the market, compared to 46% previously.