Forex: NZD/USD blows through 0.8400 on new Fed commitment

FXstreet.com (San Francisco) - The New Zealand dollar extended another leg higher against the greenback Wednesday, reaching 10-month highs after the Fed's decision to extend its bond-buying economic stimulus program (USD negative). The central bank has committed to buying $45 billion in long-term U.S. Treasuries on a monthly basis, and has kept interest rates on hold at 0-0.25%.

NZD/USD, in response, added to gains above the 0.8400 mark, peaking at 0.8450 before pullback to close the North American session up 0.5% at 0.8433, and poised to finish up around 2% for 2012. Further bullish targets lie at 0.8470 (Feb 29 high) and 0.8525 (78.6% Fibo, 0.8840/0.7370 downswing). Dips may encounter bids at 0.8355 (Sep 28 high) and 0.8317 (April 13 high). Spot currently sits quietly around 0.8430 in early Asia-pacific trade.

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