Surprise in New Zealand

Most of Wednesday unfolded as expected, with, once again, Dollar and Yen gaining appreciating. Gains were not as strong as before, but large enough to be noticeable and bring some pips. Early Thursday, very early Thursday (still only Wednesday here), brought a surprise. Employment data was released in New Zealand, and, just like last time, Kiwi responded strongly. Difference is, that today NZD strengthened, quite dramatically in light of latest market action, while in February it dropped like a rock.

Unemployment in New Zealand fell from 7.1% to 6.0%, significant improvement. Expectation is that these news will pave way for rate increase by RBNZ sooner that previously speculated. Whether it will happen during next policy meeting on June 10, it remains to be seen, but evidently markets anticipate a hike in cash rate. One must remember, however, that new budget will be revealed on May 20 and this could produce additional surprises, depending on how restrictive it gets. Regardless, today New Zealand Dollar registered strong gains.

I had interest in these news, because of my trades involving NZD. Given recent history of how much employment data effected currencies, and unpredictable nature immediate market responses, decided to close trades before announcement. One of them was short in NZD-JPY, which was posted yesterday.

Entry was a move under 67.80, or 67.78 to be precise. Objective was 100 pips. Market moved, in a fairly sharp fashion, but short of my target. price bounced at 100 SMA. By the time candle closed, (4H chart was used for the set up), it was getting close to employment news and trade was closed, for a gain of 52 pips. On the plus side, couple of other trades I took in Yen pairs worked out just fine. But that was not the case with my other Kiwi trade, this one in GBP-NZD.

Here I was hoping for a quick resolution, with entry just under 2.1100. Order was filled , but no progress took place. By the time of news release, trade was closed for 95 pips loss. And not too soon – market plunged additional 200 pips soon after.

After considerable wait, EUR-GBP sell order was finally filled yesterday, and today price reached my objective. With an entry at 0.8597, market has a good chance to see 0.8400, next support, but I wanted to get 100 pips on this swing. Should market continue lower, I will be looking at hourly charts for smaller target opportunities. Decided not to post new orders today, because I’ll be gone all day tomorrow thus unable to update the blog. Just want to point out, that on Friday we have employment data released in USA – non-farm payroll figures. Number different from estimate (177 K) can easily move all USD pairs, as well as Yen crosses. Something to keep in mind.

Mike K.
www.fxmadness.com

Just in time for Christmas.

The last trade I posted here, long CAD-CHF paid just in time for Holidays. View the last post. Entry was intended to be at 1.1400 with a target of 1.1600. That's exactly what happened and a little faster than expected. Here is the chart

http://img67.imageshack.us/img67/1491/cadchfeditedgc1.jpg

(Click on the link to see chart)

Next on the agenda is NZD-JPY. I'm selling it on the open at about 87.00 or a little below. Depends on how it opens. I'm trying to catch a large move. First target about 84.50 and final exit about 82.50. I'm going to risk 250 pips or so.

http://img165.imageshack.us/img165/3269/nzdjpyeditedyy9.jpg

This is a large move, so it must be given enough time, 3 weeks seems about right as of this writing, but subject to adjustment as the prices develop.
Merry Christmas!
Granicus.

Taking another shot.

My last entry dealt with a potential trade in NZD-CAD. Plan was to sell it at 0.7580 and ride it down to 0.7480. See previous post for the chart. Well, the trade didn't take place as NZD caught a second wind and continued higher.
Now a new set up has been created which looks promising. I have an order to sell NZD-CAD at 0.7755 with a profit target of 0.7655. I'm still looking to capture 100 pips for this move.

http://img412.imageshack.us/img412/4450/nzdcad2editedjz5.jpg

So here we are, trade is set and ready to go.
Granicus.

As alwyas, click on the link to see the chart.

Nice and easy.

The last entry contained a trade in AUD-CHF. I was going to buy 0.9700 but was filled at 0.9710. Position went through rather big pullback, so I decided to hold it longer. Insted of going for 0.9850 I waited a little longer and settled for 0.9900 or 190 pips. Good trade. Here it is.

http://img412.imageshack.us/img412/6892/audchfeditednn6.jpg

I'm looking at NZD-CAD now. Plan is to sell it at 0.7580 with a target of 0.7480. Not a large target but this set up is not meant for more.

http://img140.imageshack.us/img140/8277/nzdcadeditedua0.jpg

As always, click on the links to see the charts.
Good trading.
Granicus.

Let's see...

Both AUD and NZD are locked in a range for now. It's fun to nip at them for a few pips here and there, but sooner or later they are going to break out. Which way, though? I'm giving it a try with GBP-NZD at 2.71 and looking for something like 300 pips or 2.74.

http://img214.imageshack.us/img214/2784/gbpnzdrk1.jpg

Click the link to see the chart.

Granicus.