(MENAFN- Daily Forex)
During the Tuesday session, we have seen the New Zealand dollar rally a bit during the day, as the ¥90 level continues to be important. Ultimately, the New Zealand dollar is going to continue to offer more in the way of interest then the Japanese yen.
Ultimately, this is a situation where you will continue to look at this through the prism of getting paid at the end of every day. The ¥90 level of course is an area that attracts a lot of attention, and therefore it does make a certain amount of sense that people are willing to dip their toe into the market here.
Underneath, we have the 200-Day EMA that is racing toward the ¥90 level, and we have the 50-Day EMA just above the inverted hammer from the Monday session. If we can break above the inverted hammer from the Monday session, then I think this pair continues to grind higher. After all, the Bank of Japan can bar, but they can't really bite at this point.
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Getting paid at the end of each session is the main theme here, and even though there are some concerns out there about the Bank of Japan trying to tighten monetary policy, the reality is that they are essentially at zero, so I suppose that's something that helps them, but it is going to be paltry compared to what eventually happens if you hold on to this pair long enough. Quite frankly, I don't think most traders are willing to short this pair and pay interest at the end of every day. At that point time, you are essentially“swimming upstream” and fighting the current.
In general, I think this is going to have a certain amount of risk appetite built into it, so if we start to see markets rally again, that might be reason enough to think that this pair gain, as the pair is so highly influenced by external factors such as global growth, inflation, and of course animal spirits.
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