You can still look for selling opportunities on NZD/USD after Fonterra revised lower their milk pay-out forecast by close to 15% (one of New Zealand’s largest GDP components) which caused NZD/USD to fall to a fresh 1-month low.
You can look to short this pair around the 0.8520 area with a profit target of 0.8500 to 0.8450 however this will be a risky trade because I’m still fundamentally bullish on the NZD.
This pair is getting very close to 0.8500 which is where I expect the price tofind support so you could actually look at getting in long at this level with a wide stop loss at around 0.8350 and a target of 0.8700 to 0.8800 for a longer-term trade.
Overall Bias on this trade
This trade is a shorter term position based purely on sentiment which started from last week’s dovish comments from the RBNZ. I remain bullish on NZD in the long term and feel that 0.88’ provide a solid cap for the price action for now.
Any negative data or comments from New Zealand could cause selloffs that we can take advantage of in the short term.
If the price falls down to 0.8500 – 0.8400 I will look for opportunities to resume buying of this particular pair, or if we get any further fundamental developments.
Until this current sentiment changes I expect this pair to keep grinding lower towards 0.8500 – 0.8400 support.
At no time should anyone view the information presented anywhere on this website as advice, recommendation or proven. Everything reflected is merely opinion and may not be accurate. The purpose of the site is to express the opinions and views of Jarratt Davis. There is no intention to offer specific help, advice or suggestions to anyone reading any of the content posted here.
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