The RBNZ's Finance Minister's Cullen just dropped a bomb on the NZD markets. He essentially made the statement that they are not raising rates again until possibly after 2008. The Kiwi fell approximately 100 points in reaction to the news, on top of the 60 points already shed after we entered our shorts last night. I have just covered the last piece of the NZD/USD short at 0.6580 for approximately 125 points. There was significant September consolidation/support at the 0.6560 level, which should prove difficult to break.

For tonight, I will be looking to re-short NZD/USD at the .618 retracement of today's news event at 0.6625, and the .786 retracement at 0.6640 with stops over 0.6665. Or, if NZD/USD holds below the 0.6600 level on this retracement, I will be waiting for the 0.6560 level to breakdown to a 0.6540 area low, sell the retracement at 0.6555 with stops over 0.6585 targeting the .618 retracement at 0.6487.

This is an extremely volatile currency pair right now, so be careful and don't even think about trading this without stops.

Todd Gordon is a Technical Currency Strategist and Fund Trader with GAIN Capital Group.

Disclaimer
The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.