Forex: NZD/USD pressured below 0.8250

FXstreet.com (Barcelona) - Even though recent calls for Kiwi overvaluation coming from the IMF or NZ Finance Minister Bill English yesterday, NZD/USD is last at 0.8235, off session lows at 0.8224, retracing from Monday's NY session close weekly highs at 0.8273. The pair managed to close the weekly opening gap to 0.8216 lows on Cyprus bailout conditions fears, but it has not been able to move any higher for the week so far.

According to IMF's Bruce Aitken, the Kiwi is overvalued about a 15%, which would mean an exchange rate of 0.7 USD from current levels, "though it is difficult to put a precise figure on it," the economist added. Fears on most severe drought in last 30 years in NZ, worse trade deficit than expected just released, and Fonterra's warnings on milk production declines for the months ahead are all putting pressure to the downside for NZD/USD, though demand for high yielders is still holding the pair from going much lower, analysts say.

Immediate support to the downside for NZD/USD lies at recent session/yesterday's lows 0.8223/17, followed by March 04 lows/200 day SMA at 0.8193/6, and Dec 26/March 13 lows at 0.8162/55. To the upside, closest resistance shows at session highs 0.8256, followed by weekly highs/previous weekly close at 0.8273, and Friday's highs/Jan 28 lows at 0.8280.