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NZD/USD

  • #1,281
  • Apr 10, 2013 12:16pm Apr 10, 2013 12:16pm
Quoting pcca-matrix
Possible but expected to retrace before and then rise later to maybe uncharted territory ! i'm Waiting for NZ Manufacturing Index if flat i'm begin to be long on GBP/NZD a great opportunity too.
I'm waiting to long that pair, too. But 1.772x area keeps popping up as a potential bottom on my charts.
Time turns trend. - W.D. Gann
  • #1,282
  • Apr 10, 2013 1:32pm Apr 10, 2013 1:32pm
Quoting inpatient
added again @ .854, .857 moved TP to 0.82 Will keep adding with every move up, Keep your faith guys and just glance at the longer timeframes if your running low on confidence. We are at the same level it reached in Aug 2011 right now, if it pokes through here it could run for a while yet but the higher it goes the further it will fall. An appreciating pair such as this runs out of competitiveness the higher it gets, trust in logic and keep your emotions in check.
Hi Stephen
I keep selling it as well.Don't get scared.Mood is already brooding of direct intervention.
In trading, you have to be defensive and aggressive at the same time
  • #1,283
  • Apr 10, 2013 1:43pm Apr 10, 2013 1:43pm
Quoting pcca-matrix
Possible but expected to retrace before and then rise later to maybe uncharted territory ! i'm Waiting for NZ Manufacturing Index if flat i'm begin to be long on GBP/NZD a great opportunity too.
It won't go higher Once the ball rolls expect an avalanche.There wont be a retrace but full blown down trend to 82 or even lower.
In trading, you have to be defensive and aggressive at the same time
  • #1,284
  • Apr 10, 2013 1:47pm Apr 10, 2013 1:47pm
I sure do want you to be correct, can't understand what's driving aud and nzd today, gold is 1.5% lower today, stocks are off their highs but aud and nzd merely 10 and 5 pips below their top, what is keeping them up there!?
  • #1,285
  • Apr 10, 2013 2:06pm Apr 10, 2013 2:06pm
Quoting Nerys13
I sure do want you to be correct, can't understand what's driving aud and nzd today, gold is 1.5% lower today, stocks are off their highs but aud and nzd merely 10 and 5 pips below their top, what is keeping them up there!?
Money flowing from risk currencies to "safe" currencies.It is as simple as that however NZ can't afford their currency to be this high.Country is in serious drought.Export market is suffering now so I expect a direct innervation.
In trading, you have to be defensive and aggressive at the same time
  • #1,286
  • Apr 10, 2013 2:15pm Apr 10, 2013 2:15pm
Quoting Nerys13
I sure do want you to be correct, can't understand what's driving aud and nzd today, gold is 1.5% lower today, stocks are off their highs but aud and nzd merely 10 and 5 pips below their top, what is keeping them up there!?
I really do not know what motivates these currencies today but sometimes I feel that what we see on our charts is not is not really a reflection of what is really happening, but that's another story...
  • #1,287
  • Apr 10, 2013 2:19pm Apr 10, 2013 2:19pm
Quoting Davit
Money flowing from risk currencies to "safe" currencies.It is as simple as that however NZ can't afford their currency to be this high.Country is in serious drought.Export market is suffering now so I expect a direct innervation.
Hmm? I though nzd and aud considered risk currencies, hell I recently spoke to FX sales executive who called aud risk currency. That's wha's puzzling to me, other risk currencies such as eur have dropped quite a bit while these 2 pairs are quite resiliant
  • #1,288
  • Apr 10, 2013 2:29pm Apr 10, 2013 2:29pm
Quoting Nerys13
Hmm? I though nzd and aud considered risk currencies, hell I recently spoke to FX sales executive who called aud risk currency. That's wha's puzzling to me, other risk currencies such as eur have dropped quite a bit while these 2 pairs are quite resiliant
I think that was true in the past but for now it seems less risky for investors to bet on it instead of the other.

But i agree with Davit NZ can't afford their currency to be as high.
  • #1,289
  • Edited 4:14pm Apr 10, 2013 3:59pm | Edited 4:14pm
Quoting Nerys13
Hmm? I though nzd and aud considered risk currencies, hell I recently spoke to FX sales executive who called aud risk currency. That's wha's puzzling to me, other risk currencies such as eur have dropped quite a bit while these 2 pairs are quite resiliant


Hi Nerys,

QE3 and the previous QE's have distorted this pair significantly in a similar correlation to the Dow Jones.
On top of this the extrememly low rates in the US have pushed investments from Bonds that have almost zero return to the stock market which is being supported also by the Fed as opposed to any real strength in the US or global economy. Sure the more 'globally positioned' companies are better placed to sustain growth even when the economy in the US is still in the doldrums. However, the relative value seems to be difficult to swallow when comparing the world at the end of 2007 and now. Optimisits cling to the value in comparison to earnings to show that it still has strength to come but all they are doing is ushering in clients to keep buying into this rally. Most of them are brokers and get paid regardless and just like to see volume, hysteria breeds volume and thats what they sell.

All of this has supported strength in this pair over the longer term but it gets to the point when the NZD becomes so high that it becomes uncompetitive in terms of exports.

Three things are key here over the long term.

1 - The NZ government can not simply stand by and watch their dollar be priced out of competitiveness.
2 - The US government will end QE3 toward the end of 2013, markets will move well in advance of this and are already sensitive on any announcement.
3 - At some point (maybe 2015) the US will begin to raise rates to curb inflation and this will see a return to parity (pre 2004) forex rates between NZD and USD. Thats going to be the mother of all shorts!


The whole world is out of sync right now and there is no doubt that a huge correction is imminent and likely to begin between May and Sep this year. When could it ever be normal that the Dow Jones goes up when the US produces weak employment numbers? It happens because the source of the strength is the fed feeding the market $85B each month and that support is more likely when there are weak numbers. It is really a crazy situation and anyone with half a brain can see it will end badly, its just a case of when.

In terms of the pair i can see the NZ government stepping in before it gets out of hand and we have seen time and time again the price be rejected quite strongly anytime it is poking around north of .85

History has a habit of repeating itself and in looking at the monthly or weekly charts and factoring all of the information i have talked about here can you really not see the likelihood of the pair being kicked below .82 (at least) at some point over the next 6 months?

I try not to trade short term too much (largely because im terrible at it) However, i find it easy to look at channels reinforced time and time again and then have an understanding of the fundamentals to a point where i can fairly accurately predict the likelihood that something will happen.

This pair has generally appreciated over the last 5 years due to a difference in interest rates and particularly surged during QE phases. None of these are forever, history, logic and the timing of cycles is on the side of the shorts. Sure a trend is your friend, until it isnt and judging by the appreciation and its timing relative to the US economy/rates/QE Cycle etc suggest that the pair has found a top between here and the high of 2011.

My acc can handle .90 if needed but to me this is an easy 2000 pips, and i actually hope it goes somewhat higher to maybe 0.865 as i will keep adding. RSI on the daily is already OB so i dont expect too much more.

Good luck all,
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Money never sleeps...
  • #1,290
  • Apr 10, 2013 4:42pm Apr 10, 2013 4:42pm
The NZD is potentially almost 20% over valued at .85 with 0.7 being a more accurate value based on the fundamentals in NZ relative to the US.

The 20% is mainly attributed to QE in the US where it has also distorted the Dow Jones by a simliar 20%.

The end of QE (just the announcement of a date) will see a move toward this area in the kiwi where as the Dow may fall further as it tends to over shoot. A return to more balanced rates between the two nations may see the Kiwi consolidate around .65 over the longer term.

In terms of trading strategy it depends on where the market goes and when. If we get a pullback to .82 before the end of May then i would advise profit taking around there. If it stays above 0.82 through to June then i would hold shorts for .70 by year end. It might be possible to get in and out twice by then depending on developments in the US economy. Any sustained strength in the US will drop the kiwi as the market begins to anticipate the end of QE3.

Smart trading can pay healthy rewards
Money never sleeps...
  • #1,291
  • Apr 10, 2013 4:47pm Apr 10, 2013 4:47pm
adding short @.85860 and add more every 25-30 pips
  • #1,292
  • Apr 10, 2013 4:51pm Apr 10, 2013 4:51pm
I do not follow NZDUSD too much, but what is with the recent gains? Piggy backing Aussie? The DX was even up .2% The economic data so far doesn't look all that strong.
When the facts change I change my mind, what do you do sir
  • #1,293
  • Apr 10, 2013 5:05pm Apr 10, 2013 5:05pm
Quoting inpatient
The NZD is potentially almost 20% over valued at .85 with 0.7 being a more accurate value based on the fundamentals in NZ relative to the US. The 20% is mainly attributed to QE in the US where it has also distorted the Dow Jones by a simliar 20%. The end of QE (just the announcement of a date) will see a move toward this area in the kiwi where as the Dow may fall further as it tends to over shoot. A return to more balanced rates between the two nations may see the Kiwi consolidate around .65 over the longer term. In terms of trading strategy...
If you scan out of this chart, it looks like they became correlated around 2008

https://www.tradingview.com/e/?clone=0RhmMdG4
When the facts change I change my mind, what do you do sir
  • #1,294
  • Apr 10, 2013 5:24pm Apr 10, 2013 5:24pm
Quoting Pip Anon
I do not follow NZDUSD too much, but what is with the recent gains? Piggy backing Aussie? The DX was even up .2% The economic data so far doesn't look all that strong.

i think they have priced in the potential of increasing the monthly QE to beyond 85B, it seems very unlikely given that only last month they were increasing bets that they would chop it in half by mid summer.

That rumour seen the Kiwi drop, this rumor has seen it strengthen, some great fluctuations to trade in this pair IMO and way better than fiber particularly when its stuck in mid range around 1.30.

Pip you would be more than welcome chiming in here from time to time. Will be good to add quality and quantity to this forum. The Euro forums i have found to be too clicky.
Money never sleeps...
  • #1,295
  • Apr 10, 2013 5:27pm Apr 10, 2013 5:27pm
Quoting pcca-matrix
adding short @.85860 and add more every 25-30 pips

i cant afford to go every 25 or 30 but im ready at .86 and will again at .87 if it gets there but that will have to be my last.
Money never sleeps...
  • #1,296
  • Apr 10, 2013 5:32pm Apr 10, 2013 5:32pm
Quoting inpatient
i think they have priced in the potential of increasing the monthly QE to beyond 85B, it seems very unlikely given that only last month they were increasing bets that they would chop it in half by mid summer. That rumour seen the Kiwi drop, this rumor has seen it strengthen, some great fluctuations to trade in this pair IMO and way better than fiber particularly when its stuck in mid range around 1.30. Pip you would be more than welcome chiming in here from time to time. Will be good to add quality and quantity to this forum. The Euro forums i have...
Thanks, inpatient. I will start looking at Kiwi more. I like Aussie from time to time, and I know what you mean about eurousd
When the facts change I change my mind, what do you do sir
  • #1,297
  • Apr 10, 2013 5:32pm Apr 10, 2013 5:32pm
Quoting Pip Anon
If you scan out of this chart, it looks like they became correlated around 2008 https://www.tradingview.com/e/?clone=0RhmMdG4

Very useful chart, helps to show what is brewing
Money never sleeps...
  • #1,298
  • Apr 10, 2013 5:36pm Apr 10, 2013 5:36pm
Quoting inpatient
Very useful chart, helps to show what is brewing
Yes. That website is nice. First I have found to compare assets. All-time highs made everyday, they should all hit the floor soon enough
When the facts change I change my mind, what do you do sir
  • #1,299
  • Apr 10, 2013 5:46pm Apr 10, 2013 5:46pm
Quoting inpatient
i cant afford to go every 25 or 30 but im ready at .86 and will again at .87 if it gets there but that will have to be my last.
looks like first opportunity to hit 8600 is just before midnight est (upper tl strike time)

i remember when bollard was the rbnz guy and threatened that ccy traders would "get their fingers burned!" if they kept pushing the price up (been a while, not sure, i think it was @ ~8200).

and it did turn around and go back down. so, if the new guy wheeler comes on the wires tonight...
  • #1,300
  • Apr 10, 2013 5:50pm Apr 10, 2013 5:50pm
Quoting inpatient
i cant afford to go every 25 or 30 but im ready at .86 and will again at .87 if it gets there but that will have to be my last.
if it reach .8720 i stop adding short and my mental SL will be between 0.8870 8.8950 for all of my shorts. I am convinced of a big fall coming.


Godd luck to all
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