November 8, 2021 16:27:48

Bullish momentum in NZD/USD picks up

The kiwi is the leading major currency today on news of a further easing of covid restrictions expected by the end of the month. Strong US jobs data did little to alter the current market view. The Fed is likely to remain patient and will want to see a series of solid job reports as it assesses its goal of full employment.

After making highs above 0.72 towards the end of October, NZD/USD drifted lower at the start of this month, though the downside was capped by the 200-day SMA at 0.7098. Dollar strength seen in the immediate aftermath of NFP on Friday broke down through this level. But buyers quickly stepped in and pushed the pair higher.

Initial support comes in at the 50% level of the February to August move at 0.7133. If we can close above the September high at 0.7170, bulls will face a resistance area above. This includes the next Fib level at 0.7212 and this month’s highs at 0.7216/18. The May high is at 0.7316.

NZD/CAD breaks out above 0.89

This pair has been suffering for most of the year having made highs in February at 0.9324. The low for the year printed in June at 0.8599 and the area around here has proved strong support on several occasions.

The recent dip back towards this area held firm in mid-October. Since then, prices have moved up above the 50-day SMA at 0.88 and consolidated around the 100-day and 200-day SMAs at 0.8856. The bullish move in NZD today has potentially pushed up out of this sideways range above the near-term top at 0.8909.

If the bulls can sustain this momentum, they will target the September highs around 0.9035/41. The long-term SMAs act as support with the bottom of the recent range at 0.8802/04.