By TraderVox.com
Tradervox.com (Dublin) – The kiwi/dollar cross opened the week trading between 0.8075 and 0.8105 and then moved higher as the week progressed. The pair went as high as 0.8195 but retreated a bit to close the week at 0.8179. The New Zealand dollar was seen taking advantage of the optimism provided by the European Central Bank decision during the week. In the same week, the New Zealand Business Confidence rose more than expected to 15.1 from the previous reading of 12.6. This week there are two major events from New Zealand that are expected to affect the pair.
First, on Monday at 2245hrs, the labor Cost Index report will be announced. The nations wage cost slowed in first quarter of the year, rising by a mere 0.5 percent; the market is expecting a 0.6 increase this time. The other major event is the Employment data which will be released on Wednesday at 2245hrs. In the first quarter, there was an increase of 18 000 jobs, which is an increase of 0.4 percent from the 0.2 percent in the fourth quarter last year. There was an annual gain of 0.9 percent as the market had predicted. With these encouraging figures, the job market is healthy and investors are seeing more people joining the labor force in the country. However, the unemployment in the country rose to 6.7 percent from 6.4 in the previous quarter. The market predicts and in of 0.4 percent in employment and the unemployment rate is expected to drop to 6.5 percent.
With these reports expected and positive news expected from Europe and China, the market is bullish on the pair. Some of the technical levels that investors will be looking at include the 0.8320line which capped the pair in April. The resistance line at 0.8260 capped the pair in March and has been a strong resistance line since then. The 0.8195 resistance line has been breached this month, but the pair continues below it. The market expects this line to switch roles to support this week. Other support lines include 0.8105, 0.8075, 0.80, 0.79, and 0.7840.
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