ridethepig

ridethepig | NZDCNH Market Commentary 2020.03.01

Short
FX_IDC:NZDCNH   NEW ZEALAND DOLLAR / OFFSHORE CHINESE YUAN
NZD is moving as collateral with AUD, those following the previous AUDCNH idea will know this is no less imaginative. New Zealand is exposed to a short-circuit in Chinese supply chains leaving it vulnerable to a slowdown in China via coronavirus.

On the monetary side, RBNZ has been notably quiet around the impact from the virus. The CB will not be able to hide from the slowdown for too long, exports are already being hit, tourism , commodities and consumer confidence!

As is the case with AUDCNH:


The range we are trading in NZDCNH is clearly defined; 4.7 - 4. 05 and this trend has held since 2015. The flip is being broken and a breakdown looks imminent. Given the risk environment, I recommend trading towards support at the 4. 05 lows and selling rallies going forward.

Thanks as usual for keeping the likes coming on the CNH crosses ... an entire dissection of CNH and the impact from PBOC intervention. Jump into the comments with your charts and views!
Trade closed: target reached: Clean, simple and exactly as expected. Well done sellers!