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Forex Signal (Wednesday October 26, 2011 – 4:00pm EDT) – NZ RBNZ Interest Rate

Discussion in 'Current Forex Trading Signals' started by Stavro D'Amore, Oct 25, 2011.

  1. Stavro D'Amore

    Stavro D'Amore Former FPA Special Consultant

    Joined:
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    Hello members,

    Today we have NZ Interest rate due to come, this will most likely be a no trade. But these trades are the best when there is doubt should we get a movement.

    NZ Interest rate
    Forecast 2.5%
    Previous 2.5%
    Pair to trade: NZD/USD


    Numbers we need:
    BUY NZD/USD 2.75% or greater
    SELL NZD/USD 2.25% or lower

    Economical Impact: Critical
    Typical Result: Hawkish, Good for Currency
    Occurrence: 8 times per a year,
    Spike Probability: Good, we can see 50 pips on initial spike

    About our Triggers:
    If RBA increases interest rates, we should SPIKE in NZD of 50 pips and I will buy NZD/USD or other NZD crosses.
    At the present moment, the expectation for a rate movement is low and we could see some NZD sell off prior to the news.

    What is it? And why does the market care?
    See Felix Description

    The decision by RBNZ (Reserve Bank of New Zealand) on where to set interest rates depends mostly on growth outlook and inflation. The primary objective of the central bank is to achieve price stability.
    High interest rates attract foreigners looking for the best "risk-free" return on their money, which can dramatically increases demand for the nation's currency.

    A higher than expected rate is positive/bullish for the NZD
    A lower than expected rate is negative/bearish for the NZD.

    Method I use to trade this:
    Stavro D’Amore Trading Method

    Pre News
    There will be no pre news trading.

    Spike
    I will be ready to trade SPIKE on this release, using 15 pip limit orders/ bounds to protect myself. There is a strong chance that this will be a No trade

    After spike
    I will only trade after spike if our initial triggers are hit. I will look for a 30% retracement in the original spike if our triggers are hit before entering. I will be looking at a 5 minute chart. I will sell half my position as soon as I hit the original high point of the first initial spike and place a SL at the original spike price.

    My TP level would be just before a resistance level or if the chart decides to form a support level, looking at a 15 minute chart time frame to analyze this.

    Historical Chart and NZ RBNZ Interest Rate

    All the best

    Stavro D’Amore
     
    #1 Stavro D'Amore, Oct 25, 2011
    Lasted edited by : Sep 8, 2016

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