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NZD/USD has started correcting the previous decline – WIB

FXStreet (Barcelona) - Imre Speizer, Senior Market Strategist at WIB sees NZD/USD exhibiting the potential to reach 0.8100 in a few weeks as it has started to correct the decline which occurred between July and November.

Key Quotes

“There is potential for it to reach 0.8100 during the weeks ahead. Helping the bounce has been the RBNZ’s reminder last week that the tightening cycle is not over, contrary to market speculation (and positioning). Throw in a US dollar which appears to be tiring, plus speculative positioning which became extremely short, and the makings of a decent multi-week rally in NZD/USD are there.”

“The main NZ risk to this positive near term view is any further decline in dairy prices (auction on Tue night). From the US there are FOMC minutes (Wed) and Oct CPI (Thu) to watch out for.”

“Over the medium term, there remains potential for it to fall to 0.7500 by February if the USD resumes its Fed-driven uptrend and NZ dairy prices fall further.”

“By late 2015, the exchange rate could stage a rebound to the low 0.80’s if NZ’s commodity prices rise in line with global demand.”

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