Wednesday 14 January 2009

Trade Entry: NZD/USD Short Position, 14-Jan-09

Security: Spot FX (mini) NZD/USD
Direction: Short
Contract: 1 (mini)
Opening Price: 0.55668
Opening Contract Value: NZD$10,000 (US$5,566.8)
Limit Level: 0.52668
Stop Level: 0.57668
Amount Risked: US$200
Interest rate differential fee: -4.75% p.a.

Technical Justifications:
  1. Standard & Poor’s warned that it could downgrade the country’s foreign currency debt rating, sending the Kiwi dollar on a downward spiral against other currencies; and NZ central bank expected to cut rates by at least 100 basis points on January 29, see here.
  2. Recent bullish rally fail to break resistance level of 0.6000, and bearish trend developing.

Chart


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