Short NZD vs USD and JPY trades and comments 14-19 June 2017
Mon 6/19/2017 7:40 AM MDT
Real Time AmpGFX – Sold NZD/USD (re-established)
I have sold half unit NZD/USD at 0.7243
The USD has been choppy in the last week with a range of developments. The USD appeared vulnerable to a deep slump after the weak CPI report, but has received a reprieve after a more hawkish Fed (Dudley comments in US morning have bolstered the USD). It may be due a period of recovery on short-covering after testing key supports in recent week, and showing some stability. The USD’s gains since mid last week are starting to look more broad-based.
The strongest currencies recently have been commodity currencies, CAD, NZD and AUD. There may be some reasons for this, however, they may now be at levels that appear extended relative to mixed fundamental developments. I don’t see any significant changes in the RBNZ policy statement this week.
Position
Short NZD/USD at 0.7243; s/l 0.7313
Thu 6/15/2017 7:25 AM MDT
Real Time AmpGFX – Sold NZD/USD
Sold half unit NZD/USD at 0.7185
Position
short half unit NZD/JPY at 79.67; s/l 80.13; t/p 75.58
short half unit NZD/USD at 0.7185; s/l 0.7258; t/p 0.6558
Comment
US manufacturing surveys strong and jobless claims strong.
US yields are higher since lows yesterday. UK 10 year yields are up 9bp, and Eurozone yields have followed up around 5bp.
Equities softer.
NZD has been supported by lower global yields and stronger EM markets.
NZ GDP weaker; consistent with recent pattern in NZ data.
OECD endorse DTIs addition to macroprudential tools.
Looming NZ political risk.
Wed 6/14/2017 2:24 PM MDT
Real Time AmpGFX – Sold NZD/JPY
Sold half unit NZD/JPY at 79.67
Position
short half unit NZD/JPY at 79.67; s/l 80.13
Comment
I see risk NZ GDP underwhelms later today. Recent NZ eco data has ebbed. NZ housing market data is weaker. Political risk in NZ looms.
The oil price fall is perhaps the most significant thing today. This may keep US yields down, regardless of the Fed’s fairly hawkish assessment.
Lower yields support EM currencies and may support NZD also, but lower oil and yields may also support JPY.
USD/JPY is the one currency pair that has not fully bounced back after the FOMC, and Is more closely watching US 10 year yields.
NZD/JPY 80 figure level should be good resistance.