Forex Analysis For NZ GDP q/q 03/21/12

We’ll be getting the quarterly release of New Zealand’s GDP, and because it is a quarterly release, market tends to pay more attention to it, thus more volatility is expected. Here’s forecast:


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5:45pm NZ GDP q/q Forecast 0.6% Previous 0.8%
Action: NZD/USD BUY 0.9% SELL 0.3%

The Trade Plan
The expected consensus number is 0.3%, and the safe deviation is 0.3%, in the event it is hit, we should see market move 40 pips within the hour.

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We’ll be looking to BUY the NZDUSD if the release is at 0.9% or better, or we’ll SELL NZDUSD is the release is 0.3% or worse. We’ll be using our standard after-news retracement trading method.

For more information on the Retracement Method, please read:

The Market
NZD has been tracking the Equity Market closely, but with recent comments out of RBNZ, investors are hesitant as NZD may be overvalued, very much like its larger neighbor, Australia… If we get a strong release today, I’d be looking to BUY NZD, and we could look at AUDNZD as an alternative as the pair may be more volatile than others.

Additional Thoughts
NZDUSD is a slow yet steady currency pair. If we do get our deviation, we should get in the market as soon as possible…

Pre-news Trading
There is no pre-news trading with this release today…

“Gross Domestic Product (GDP) measures the total value of all goods and services produced by the economy. A rising trend has a positive effect on the nation’s currency. GDP is the broadest measure of activity and the primary gauge of the economy’s health. To foreign investors, a strong economy is viewed favorably because it spurs investment opportunities in the domestic stock and bond markets. More importantly, the central bank is more likely to raise interest rates in the face of a strong and growing economy. The combination of these effects can have a large impact on the demand for the nation’s currency.”


About Henry Liu

My name is Henry Liu and I am a Forex Trader and Mentor. I help traders achieve consistent income trading Forex while spending less time trading. My focus in trading is a combination of Fundamental Analysis, Technical Analysis, and Market Sentiment. Far too many retail Forex traders concentrate on just one aspect of trading, technical analysis, and ignore everything else; it is my goal (and vision) to educate every trader on how to take advantage of news trading and become more balanced traders.

You can find more information about me on my Google Profile.

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