Trade Ideas

NZD/USD: And speaking of exhaustive moves!

If the move over 1.3700 on Friday was symptomatic of an exhaustive move in the EUR/USD, then how likely is it that yesterday’s move to .8500 in NZD/USD was of a similar ilk?

It’s now against my religion to trade the NZD so I will leave that to braver souls, but surely risk-reward would suggest a small short position with a stop above .8500 might just bear fruit?

Or am I stupidly applying logic to the Kiwi? 🙂

  1. Morning Sean, what’s your view on USD/CAD? Based on the daily chart, I just bought some. Looking at the price to go back up to 1.005/6.

  2. IMHO you often cant apply logic to the Kiwi – Not unless you know where the money flow is coming/going. Its easlly pushed around by the flows. i.e. take all the Beijing money being converted to NZD at the moment.

    My rule (especially) for the kiwi is trade what you see, not what you think. You cant rely on fundamentals too much for a bais upon which to place your trades.

  3. Ain’t that the truth Kiwi. Do BNZ Welli still rule the roost or are the bigger prime brokers taking over? I’d heard a lot of chat re China, banking licenses etc but no exact numbers as to how much is being bought?

  4. Hi Jones, definitely prefer the long side but no strong ideas on short term levels. At this stage I’d say you’re a 70% chance of a win on this trade but you do know all about my CAD prowess? Or lack thereof!

  5. Sean, I think the other (Australian owned) banks like Westpac and Commonwealth (ASB) are definitly giving BNZ a run for their money and there are more and more brokers of all sizes popping up with ties back to all over the world.

    Deep dark murky money trails

    (No surprise though as there is a bit of speculation that some of the yuan coming into NZ is rather tainted and needs to be cleared out of Beijing now that the newish government over their is cracking down on corruption and bribery – i.e. look at Aucklands property market)

  6. That’s a worry for such a small currency like NZD. Same problem here in Oz, government needs to tighten up ownership regulations.
    50 years ago countries were worried about being invaded by the communists but now they are being bought by them 🙂

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