The NZD/USD pair rose during the session on Tuesday, breaking the top of the hammer that had formed on Monday. That of course is a very bullish sign, but we did give back a little bit of the gains towards the end of the day. It is possible that this market will go higher, perhaps hitting the 0.84 level. However, this is not going to be the easiest of moves going forward, and as a result it is going to be choppy at best.

If trader get above the 1.04 handle on a daily close, this market will go straight to the 0.85 level. That area could be significant resistance, but it could end up being a nice little move between the 0.84 level, and that area if we get the chance.

Pay attention to the Federal Reserve and commodities markets.

Pay attention to the Federal Reserve and whether or not he can taper off of quantitative easing. This will highly influenced this market, simply because the New Zealand dollar of course does follow commodities in general. If the Federal Reserve gets decent employment numbers to work with here soon, we could see this market turnaround drastically, and start falling. However, it’s not probable that the markets will have that opportunity between now and the end of the year. Any fall from this level will more than likely be a minor, and therefore traders should be a bit hesitant to get overly excited about that move.

This is especially true considering how supportive the 0.82 level looks to be at the moment. With the 0.82 level been so supportive, and the 0.84 level been so resistive, this is a market that's probably going to be a scalper’s type of market more than anything else, and not so much one that should be hung onto for a few sessions. Because of that, I am on the sidelines, but if you are one of the people out there who likes to trade the 15 min. chart, this could be a good marketplace for you.

About the Author: Alp Kocak has been trading forex since 2003. He writes technical analysis based on Japanese candlesticks and Ichimoku Kinko Hyo and is a senior educator at FX Academy where he provides trading strategies to traders at all levels.

About FX Academy
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