New Zealand dollar breaks out during the Monday session

Risk appetite is a major driver of the New Zealand dollar, and we have broken out to the upside as it appears that the Americans and the North Koreans are going to talk after all. Ultimately, I think that this market will also be focusing on commodities as per usual, and of course the stock markets in general as it gives us an idea as to where money will be flowing. If they go higher, typically people start looking around the world for more risk. The New Zealand dollar of course is the epitome of a “risky currency” as far as larger currencies are concerned, so it does tend to move right along with the rest of higher risk returning assets.

I think that the 0.70 level underneath is massive support, but it extends down to the 0.6960 level. The market could go as high the 0.72 level above, which of course has been important in the past. If we can continue to bounce, the market could go as high as the 0.75 level. However, I think it’s can take a certain amount of wherewithal to hang onto a move to the upside, but I had been speaking previously how we were closer to the bottom of a longer-term consolidation area, that has been in effect for at least two years. Overall, I believe that the buyers will eventually continue to push, but it’s going to be a hard fight to go higher.