We took this trade live during the risk event at our personal account, but we will use Buy Stop Pending for our regular Daily Trade. Please see entry & stoploss at bottom of the page.
IF rate stays the same
BUY NZD/JPY
or
SHORT GBP/NZD
IF rate is cut
BUT AUD/NZD
*Press Conference*
Felt more dovish as “the objective is to keep low interest rate and they do not rule out the possibility of further lower interest rate”
As mentioned, the NZD has a very similar economic situation as AUD but AUD has better commerce due to high demand of rare commodities from Chinese manufacturing, where in NZD the real business is the dairy products.
“always looking at the necessity of intervention if NZD is too high” (which hurt the export)
LONG AUD/NZD
@ 1.0518
SL @ 1.0342
11/10
Possible SL @ 1.0475 to 1.0506
11/11
11/17
11/18
Out at 1.0540
- After the night of election volatility, we seem to have a stronger USD and positive sentiment market again as the Donal Trump win did not cause much panic due to his speech. Market has quickly regained confident to his possible trade deals, and now all equity markets and WTI are up while safe heaven currencies are all down. Of course, this could be a short-term effect and no one knows for sure what we’re heading in the next few days or weeks. I’m going to short NZD if we have a rate cut today against AUD, as mentioned, same idea that both currencies are hedged out in risk sentiment and AUD has a slightly better edge if all things are equal. If we don’t have a rate cut, then NZD will still be the strongest currency in terms of interest rate, then i’ll buy it against JPY for intraday. I’m also going to enter IntraDaily trade in this one because this economic release is important. If rate is cut, i’m also going to buy AUD/NZD and hold it for long-term. If rate is not cut, then i’m going to long NZD/JPY for intraday but short GBP/NZD for long-term. The reason is because GBP still has this fundamental uncertainty, and are in the same asset class as risk on currency, we’re also at a good range levels, in comparison with other possible pair to short such as EUR/NZD.
- The catalyst is the RBNZD rate decision
- We’re in the middle part.
- The risk is the sentiment play from USA, so i have avoided to buy/sell USD at all, but the sentiment can still shift drastically in the next few days or weeks, that’s why i pick currencies that are hedged out each other for long-term play; such as AUD/NZD for rate cut & GBP/NZD for rate unchanged.
- I’ll manage it with the price action, global market sentiment and RBNZ statement.
- Yes
IF rate stays the same
BUY NZD/JPY
or
SHORT GBP/NZD
IF rate is cut
BUT AUD/NZD
- I got in at 1.0492 (SL @ 1.0342) and the market went down immediately to 1.04 to find support, the future statement has been positive from RBNZ.
- The RBNZ did have positive statement and also worry about housing market will support the rate decision; and AUD still is more favourable in terms of sentiment buying and hedging. So what’s gonna happen now is really depended on the global sentiment this week following closely to US election and overall equity markets. If we have a good sentiment week, then AUD will find support and further advance, if we have negative sentiment, then AUD might be sold off more than NZD, as that’s usually the case.
- I’m still in because i don’t have a clear direction to go, so 50/50 probability and i’m giving it more room to play out and be confident for the 1.04 handle to hold.
- I’d actually get into this trade NOW as i’ll be in at a much better level. Overall i’m still bullish in AUD more than NZD. But again, we might get stopped out due to the bad level of entry and price action to get whipsawed. This is always the risk of doing IntraDaily Trade as you get in early but you also have less information in terms of price reaction to the event.
*Press Conference*
Felt more dovish as “the objective is to keep low interest rate and they do not rule out the possibility of further lower interest rate”
As mentioned, the NZD has a very similar economic situation as AUD but AUD has better commerce due to high demand of rare commodities from Chinese manufacturing, where in NZD the real business is the dairy products.
“always looking at the necessity of intervention if NZD is too high” (which hurt the export)
LONG AUD/NZD
@ 1.0518
SL @ 1.0342
11/10
- We had a large buying power into AUD overnight but then it soon died down to the original level near 1.05. There is no significant catalyst to drive these 2 currencies as the whole market is reacting to the post U.S Election sentiment.
- I think we will most likely to go sideway, but of course, if any new comments or updates from U.S, positively is going to drive the AUD up again and vide-versa.
- I’m still in this trade because I don’t see a clear direction and if all things are equal, this trade should still go up as AUD is still strong fundamentally and sentimentally than NZD. However, because of the current uncertainty surrounding U.S and future policies, any comments from U.S might shift the sentiment especially for China, which is AUD’s largest trading partner. So i’m going to monitor this trade in shorter-time frame of 1 hour chart. We have a strong support of 50% fib, horizontal support, trend line support all around 1.0475 - 1.0506. If any hourly candle drops below here and closed below, i’m going to get out of this trade.
- I will NOT get into this trade honestly because of the uncertainty is too high in the market now. But since i’m already in, i’m going to reduce the risks of it.
Possible SL @ 1.0475 to 1.0506
11/11
- I’m going to tighten my SL to 1.0492 and next week if we touch 1.0698 (that is if we don’t get stopped out over the weekend, it’s possible), then i’m going to move SL to BE at 1.0520 (my filled entry)
11/17
- I’m going to move my SL to 1.0597 at the low of past 5 candlesticks - 10 pips.
11/18
- i decided to get out of this trade with a small profit as i’m wrapping up ahead of weekend.
Out at 1.0540