May Trade # 10 - SELL NZD/USD

May 18, 2009, 6:50am (Manila)

Unfortunately, the pair went on an upward and my 2 lots were stopped-out at -88 pips total.

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It's another week in May.

My firs trade for the week:

SELL NZD/USD @ 0.5837
STOP - 0.5880
Limit 1 - 0.5817
Limit 2 - 0.5797

Reason: New Zealand's PPI q/q came out worse than expected. I expect this to bear down on the NZD and drag it down vs. the USD. Negative PPI means that manufacturers are paying less for their raw materials. When this happens, they are expected to pass this on to consumers in their final products. Lower prices will reflect lower inflation which is bad for a currency.