Sforex
Short

RBNZ NEXT WEEK: HIKE OR HOLD INTEREST RATE ?

FX:NZDUSD   New Zealand Dollar/U.S. Dollar
311 1 2
- Fundamental Analysis:
Kiwi: commodity currency. What we knew about Kiwi last week: that was a drop in CPI             . NZ             CPI             dropped to 1.5% from 1.6%; Kiwi responded to this drop by falling down to 0.856 key support level . This is a strong support according to Gann Square Nine.
Next week, all eyes of investors will pay attention in RBNZ interest rate decision. Most forecasters expect RBNZ will hike rate by 25bp to 3%.
We know that in the recent rate hike, RBNZ confirmed that they will hike rate gradually, and the interest rate will be stable at the peak 4.75% by 2016. We still have 14 RBNZ Meetings from now to end of 2015. 4.75%-2.75%= 2%; It means we need 8 times of rate hike: 8 times in 14 Meetings. To RBNZ hikes rate, we need pickup in inflation . The monetary policy of RBNZ is to keep inflation from 1% to 3%, and they still have a lot of room for this target; CPI             is now at 1.5%. In my opinion, I hold my viewpoint that RBNZ would not hike rate this Minutes.
- Technical Analysis:
23.6% Fib retracement was pierced; the next target is 38.2% Fib retracement at 0.8478
Donchian Channel: I see a SELL signal clearly.
I keep the Short Position to 0.85 psychological level. Stop Loss at 0.866
If RBNZ hikes rate, trend reverses, I will close my Short position to Long N/Z

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This is one great analysis. I tend to agree with you here.
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