(MENAFN- Daily Forex)

• The New Zealand dollar has fallen pretty significantly during the trading session here on Wednesday as we continue to see the US dollar strengthen against almost everything.
• The jobs numbers are coming out after the Fed meeting, so this cuts back the idea that the Fed may jump in and start cutting rates.
• I think that's part of what's going on.

But quite frankly, this is just the same US dollar strength that we had seen for a while, and especially against currencies like the New Zealand dollar that are driven by commodities and risk appetite. It makes a lot of sense that we continue to see the greenback steamroll some of these other smaller currencies, like the New Zealand dollar. Short-term rallies at this point in time should be selling opportunities, with the 0.57 level a significant barrier now that we have broken even lower.

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In fact, we're now at a fresh new low for the cycle, and I think we could be looking for extreme lows at the 0.55 level. Short-term bounces, I look for signs of exhaustion to short the New Zealand dollar anyway. It was telling that the last couple of days have been somewhat sideways.

The 50-day EMA is at the 0.5745 level and dropping, so I think that coincides with the 0.57 level as being a major barrier to overcome. All things being equal, it'll be interesting to see how we play out. But if we were to break down below the 0.55 level, that opens up a huge plunge in this market. So, all things being equal, I think this remains a market that you're shorting. Whether or not the deep bottom at the 0.55 level holds is a completely different question.

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