Yesterday the Kiwi broke down out of our bearish channel that was forming and went on to test the key 0.7200 level. A stronger than anticipated CPI figure out of the US certainly didn’t hurt as the NZD was again one of the weaker performers.
I’m still bearish on the NZD, however, we have to be a little cautious with the new developments from North Korea. I am expecting to see a test of 0.7150 in the near futures, however, I want to tread a little carefully going into the close of the week. Of course, any USD strength will help our case, but that might not follow through as planned given the latest missile test.