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8 May 2013
Forex Flash: NZD drops on RBNZ commentary - Societe Generale
FXstreet.com (Barcelona) - Kit Juckes, Global Head of Currency Strategy at Societe Generale notes that NZD fell after RBNZ Governor Graeme Wheeler stated that the central bank had sold some kiwi to keep the currency from appreciating too much.
He notes that the RBNZ has repeatedly exclaimed that the NZD is overvalued. The carry trade has buoyed NZD, and the RBNZ’s hands in terms of easing monetary policy to counter currency appreciation have been tied by the New Zealand housing boom. He writes, “According to CFTC data, there is a record net long non-commercial position in NZD.” Further, Juckes comments that he reiterates his short NZD/CAD trade recommendation, which just broke below the 100-day moving average for first time since Oct 2012. Further, he feels that AUD/NZD looks interesting too as 1.20 is a big level, and tactical traders might find good risk-reward being long AUD/NZD against it.
He notes that the RBNZ has repeatedly exclaimed that the NZD is overvalued. The carry trade has buoyed NZD, and the RBNZ’s hands in terms of easing monetary policy to counter currency appreciation have been tied by the New Zealand housing boom. He writes, “According to CFTC data, there is a record net long non-commercial position in NZD.” Further, Juckes comments that he reiterates his short NZD/CAD trade recommendation, which just broke below the 100-day moving average for first time since Oct 2012. Further, he feels that AUD/NZD looks interesting too as 1.20 is a big level, and tactical traders might find good risk-reward being long AUD/NZD against it.