RBNZ Interest Rates decision today is expected to cut by another 25 basis points, so if there are no surprises today, we should stay out of the market. However, if RBNZ surprises the market by over-cutting (50 basis points instead of 25), then we should SELL into the news.
3:00pm (NY Time) RBNZ Interest Rates Decision Forecast 1.75% Previous 2.00%
DEVIATION: 0.25% (BUY NZD 2.00% / SELL NZD 1.50%)
The Trade Plan
Current forecast from economists surveyed by Bloomberg agree that RBNZ is likely to cut the official rate by another 25 bps at this meeting; however, in the event that Governor Wheeler surprises the market either by keep rates unchanged or cut by 0.50%, we should see an immediate strong volatility in the NZD which is a great opportunity to spike trade NZD.
For more information on my trading methods, please read: https://www.currencynewstrading.com/how-to-get-started-with-news-trading/
I’d recommend to use the Recommended Pairs from above as they are based on my CSM, which should provide the best combination of currency pairs to trade based on better/worse news… of course, you can also trade the default pair: NZDUSD.
Outlook score is derived from market sentiment, focus, and economic indicators for the currency. It represents the long-term trend of the currency and its market perception. In short, a strong Outlook Score means more long-term demand for the currency, and a weak Outlook Score is the opposite.
The OCR (Official Cash Rate or RBNZ Interest Rates) influences the price of borrowing money in New Zealand and provides the Reserve Bank with a means of influencing the level of economic activity and inflation. An OCR is a fairly conventional tool by international standards.