![\"nzdusd](\"http:\/\/www.laidtrades.com\/wp-content\/uploads\/2010\/06\/061610nzdusd.png\")
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The NZDUSD pair has come a long way from my last post (click here). Looking at its 4-hour chart, you can see that it has recently broken out from a double bottom formation. Now, a double bottom is generally seen as a downtrend reversal pattern. Given this, the New Zealand dollar could rise against the USD in the short term. With stochastics still far from the oversold area, the pair could hover for awhile above the pattern\u2019s neckline before continuing its ascent. Once it does, it could aim for its previous high just below the psychological 0.7300 marker. On the other hand, if the support at 0.6900 gives way, the pair could fall all the way back down until it finds support at the trough of the pattern which is around 0.6550.<\/p>\n
Fundamentally, the Kiwi\u2019s recent rise was helped by the improving optimism in the markets. There was a nice rally to end last week when the US\u2019s University of Michigan consumer sentiment index surpassed the market\u2019s forecast. Traders\u2019 optimism was sustained come Monday when the euro zone\u2019s industrial production also exceeded the market\u2019s expectations. Yesterday, a rally once again occurred when the 11th straight month of rise in the Federal Reserve Bank of New York\u2019s manufacturing index added signs that the rebound in the global economy is withstanding the debt crisis in Europe.<\/p>\n
Now, the data that will be coming out of the UK and the US will likely sway the Kiwi\u2019s short term valuation. The UK\u2019s May retail sales are seen to have printed a 0.1%\u00a0 after rising by 0.3%\u00a0 the other month. Back stateside, the latest initial jobless claims are expected to taper a bit to 452k from 456k. Though, its Philadelphia Fed Manufacturing Index is likewise projected to soften to 21.1 from 21.4. However, the recent jump in the New York Fed Reserve manufacturing index could also indicate a possible better than projected result in the formaaer\u2019s number as well. In any case, any positive suprise from these accounts could buoy the anti-dollars like the NZD.<\/p>\n