- Today we had a positive comment from RBNZ saying that the rate is most likely to be hold for some time, on top of that, yesterday’s GDT price was also a positive data. Moreover, the current risk on sentiment has helped NZD which is still the highest yield currency in all major 8 currencies. The current selling into USD also put NZD as the top of the currency to buy. Then, we had very negative datas today from GBP and negative comments from Parliament members in regards to backing up Brexit regardless of the High Court Ruling. This is a fundamental & sentiment bearish tone into GBP. We also had a bearish candlestick now at resistance level.
- The catalyst is the comments from both countries and datas from both countries.
- We’re in a downtrend and resistance.
- The risk is another positive comment from UK, or if ECB tomorrow signals very negative sentiment, these will all help GBP.
- I’ll manage it with price action and news.
- Yes this is a very good situation to have both fundamental, sentimental and technical line up for this trade.
SL @ 1.8034
TP @ 1.7082
- We got in at 1.7556 and it went down initially but during the ECB meeting, as mentioned the negativity into EUR has helped to strengthen GBP.
- We also had news today from High Court ruling that the hearing is finished and the result will be out very soon. I think right now the GBP will really play by its sentiment, although fundamentally weak but the high court ruling + the EUR weakness might give it a lot of strength. Meanwhile, we’re still very confident toward NZD as the risk on appetite and the uncertainty of USD and internal negativity of AUD have made NZD to be the best currency to buy.
- I’m still in this trade because of the above reason, however, because tomorrow is weekend and we don’t know when the high court ruling is going to be out and we also don’t know how much volatility it can give to GBP. Our best scenario was that ECB gave good sentiment to EUR which will pressure GBP and help NZD - however that did not happen, so now we’re more cautious in holding this trade as the risk event of GBP is still in play.
- I’ll only get into this trade if i’m flat, by hourly. And that’s why i’m also adjusting my SL now in hourly chart to avoid any unexpected volatility between now and then.
Move SL @ 1.7670 which is 2 swing high in the hourly chart.
We’re hoping for the trade to take out 1.75 and stay below in the next few hours.
- we have seen continuous strength into NZD versus other currencies, but GBP still remains well supported. We have moved our SL to the recent hourly swing high @ 1.7659
We got out of this trade @ 1.7605 as we don’t want to hold it any longer since NZD has lost its gains and GBP continued to gain strength now.