Today’s sample of Forex Analysis from

New Zealand Dollar investors were surprised today when the Reserve Bank of New Zealand announced that there remains a chance that interest rates would remain low until late 2010. The central bank left interest rates at 2.5 percent at its meeting today but expressed concerns that high interest rates and lofty currency price could curtail future growth and bring on additional risks.

Technically, the current chart pattern suggests that this currency pair is set up for a weekly closing price reversal down. A close under .6554 will be a strong sign that this market is topping out with a downside target of .6413 to .6362.

The Aussie Dollar gained on both the New Zealand and U.S. Dollars. News that New Zealand is still considering an interest rate reduction strengthened the Aussie while weakening the Kiwi. The strong surge in the U.S. equity markets early in the trading session helped increase demand for risk leading to a surge in the AUD USD. Today’s gains erased yesterday’s lost but failed to come close to challenging the high for the week at .8337.

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