Hello Traders,
Crude Oil inventories caught a lot of speculators and traders flat footed yesterday. According to EIA, there is still an inventory shortage of 600K barrels despite a 0.4% growth in production for the week. While many expected a surplus of crude because of the favorable weather and increasing number of rigs-number of rigs have been rising since May according to report by Robert Hughes-which translates into production for now. Another thing to be wary of is the coming winter which logically should have increased inventory of heating oil and distillates. This release however didn’t cause much volatility as price action shot up and came down later in the session. Also released in the Asian Session was the New Zealand GDP, its growth remained unchanged at 0.9% despite increasing production, the booming housing sector, increasing consumer expenditure abroad and improving retail prices. This was a better release and above the RBNZ projection of 0.8% for June quarter. With this release, the Kiwi slipped by about 30 pips and moved sideways bouncing around the support trend line.
To the charts now and it is apparent that our level of support is really important-check the attached 15 min chart and see what I’m talking about. Price action couldn’t manage to break below the support and as long as it remains below the 0.73 level, we shall hold to our bear projection as we wait for a break below the 0.723 daily support trend line clear in the 15 min chart.
Our plan for today is very simple-if you are trading the NZDCHF pair watch out for CHF Libor rate decision at 730 GMT-my analysis tell me that this should be a bear move-last week ended with an inverted hammer in the weekly chart and since then a bear candle with a long wick continues to form. For the USD traders, watch out the Retail News at NY open and look to buy the USD if it comes out positive.
Trade as follows:
Sell Limit: 0.728-0.731-Look to sell at yesterday’s Highs
SL: 40 pips from where you initiated your sell
TP: 1:3 risk reward ratio or 0.70 if you looking for long term projections.
Otherwise, may the pips be with you, have a good trading day.

NZDUSD 15 min chart-15.09.2016

Source: Dalmas Ngetich

NZDUSD Daily chart-15.09.2016

Source: Dalmas Ngetich

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.