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"Provided the US government walks to the brink and doesn't actually jump over it, the New Zealand dollar should be advantaged because this dysfunction is just increasing the time it is going to take for the US economy to recover, increasing the amount of time that the Federal Reserve will keep monetary policy easy for and therefore increasing the attraction of the carry trade. But if they do jump over the brink, which isn't a zero possibility, then the world is going to have a big risk-off event which would typically see the New Zealand dollar underperform."
- ANZ (based on The New Zealand Herald)
Pair's Outlook
Bears kept the pressure on the pair, but failed to push it below 0.882, which gave enough of an impetus to return the pair to the vicinity of the 20-day SMA/weekly PP. As showed by the short term technicals the pressure on the pair remains and only advancement above 0.837, could provide some further freedom of movement for the pair. In case it dips below the weekly S1, we should anticipate a sell of till 91 cents.
Traders' Sentiment
Situation in the market remains exactly the same as yesterday. Bears hold 73% of all open positions in the market; 64% of pending orders are set in the favour of the bulls.
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