Oct 26th, 2015: China Still Setting the Pace

• It’s been a positive start to the new trading week as markets continue to react to the news of China’s rate cut late last week. The move has been a particular catalyst for the Australian and New Zealand dollars, with the former and some extent the latter closely tied with to the fortunes of the Chinese economy. The NZD/ USD is up 0.53%, with the AUD/ USD climbing by a similar margin.

• The euro is also on the rise (slightly), or at least last week’s selling appears to have been paused.

• In the context of this counter party strength, the US dollar is backing off, with the USD/ JPY gapping lower at the Monday open. The US dollar is nipping backwards after days of solid gains.

Coming up today: 

• Coming up today we German Ifo Business Climate at 09.00.
• This is followed by US new home sales a 14.00.

Trade Idea: 

• The NZD/ USD continues to set the pace, holding steady in a period of dollar dominance. China’s rate cut offer little help in the long term to the over extended Chinese economy, but in the short term, the momentum effect is looking good for the Kiwi.

• A good way to play this is a HIGHER trade predicting that the NZD/ USD will close above 0.6800 in 21 days for a potential return of 103%.

 

This is presented as an idea to stimulate fixed odds financial betting ideas and is not financial advice. 

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