How to Trade AUD, NZD, CAD

With Boris Schlossberg and Kathy Lien

Past performance is not indicative of future results. Trading forex carries a high level of risk, and may not be suitable for all
investors. The high degree of leverage can work against you as well as for you. Before deciding to trade any such leveraged
products you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists
that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you
cannot afford to lose. You should be aware of all the risks associated with trading on margin, and seek advice from an
independent financial advisor if you have any doubts.

The information, including Commentary and Trade Ideas, provided on bkforex.com should not be relied upon as a substitute
for extensive independent research which should be performed before making your investment decisions. BKForex LLC and
bkforex.com are merely providing this information for your general information. The information and opinions presented do not
take into account any particular individual’s investment objectives, financial situation, or needs. All investors should obtain
advice based on their unique situation before making any investment decision and should tailor the trade size and leverage of
their trading to their personal risk appetite.

BKForex LLC will not be responsible for any losses incurred on investments made by readers and clients as a result of any
information contained on BKForex LLC. BKForex LLC do not render investment, legal, accounting, tax, or other professional
advice. If investment, legal, tax, or other expert assistance is required, the services of a competent professional should be
sought.
Australian Dollar
 Background
•Symbol A$

•Nickname - Aussie

•AUD is 5th Most Actively Traded Currency (6.9% of total daily

turnover)

•AUD/USD is the 4th Most Actively Traded Currency Pair (5% of

total daily turnover)

•Export Dependent Economy

 Central Bank
• Reserve Bank of Australia (RBA)
• Mandate: Low and Stable Inflation (1 to 3% Target)
• Created: 1959
• Central Bank Governor: Philip Lowe
 More Details ….
Most Important Most Important
Export Partners Import Partners

1) China 1. China
2) Japan 2. USA
3) USA 3. Japan
4) South Korea 4. South Korea
5) India 5. Thailand
 What Do They Sell?
* World’s #1 Exporter of Coal Iron Ore
1. Coal
2. Natural Gas
3. Gold
4. Beef

27% of all Australian exports destined for China

AUD = Commodity Currency
 Pip Values
1 pip = 0.7025 -> 0.7026
10,000 / 100,000

AUD/USD = $1 / $10
AUD/NZD = $0.63 / $6.30
AUD/JPY = $0.83 / $8.30
EUR/AUD = $0.71 / $7.13
GBP/AUD = $0.71 / $7.13
AUD/CAD = $0.75 / $7.54

*As of Sept 2015

 When Does AUD Move?

Tokyo Open
7:00 PM ET / 23:00 GMT Tokyo Open
Australian Data
7:30 PM ET – 12:30 AM ET (23:30-1:30 GMT)
Chinese Data
9:30 PM ET – 1:30 AM ET (1:30-5:30 GMT)
European Open
2 AM ET – 3 AM ET (6-7 GMT)
US Data
8:30 AM ET – 10AM ET (12:30 - 14 GMT)
 Key Economic Reports
1. Employment = Employment Change (Part Time vs. Full Time)

2. Retail Sales = Retail Sales

3. PMI = PMI Manufacturing & Services

4. Inflation = Quarterly Consumer & Producer Prices (CPI/PPI)

5. GDP = GDP

6. Trade = Trade Balance

7. Confidence = Westpac Consumer Confidence

8. Central Bank Meetings & Minutes = RBA Meeting, Minutes

 AUD Trading Tips

▪Correlation with Commodity Prices

▪High Interest Rate, High Beta Currency
▪Particularly Sensitive to Chinese Data
▪Carry Trade Demand
AUD/USD Correlations

1. AUD/USD vs. Yields

2. AUD/USD vs. Stocks
3. AUD/USD vs. Commodities
4. AUD/USD + Risk Currency
AUD TRADING TIP #1

Correlation with Commodity

Prices
AUDUSD & Iron Ore
AUD TRADING TIP #2

Importance of AUD/CNY Rate

AUD/CNY
 AUD TRADING TIP #3

AUD/USD Tracks AU-US 2 Year

Yield Spread
AUD/CNY
AUD TRADING TIP #4

AUD/USD Data Reversal

AUD Crosses
Canadian Dollar
•Symbol C$ Background
•Nickname - Loonie

•CAD is 7th Most Actively Traded Currency

•USD/CAD is the 5th Most Actively Traded Currency

Pair
•US Consumes +75% of Canadian Exports

•World’s 5th Largest Producer of Oil

•Bank of Canada (BoC)
•Mandate: Price Stability – Keep Inflation Near 2%
•Created: 1934
•Central Bank Governor: Stephen Poloz
 More Details ….
Most Important Most Important
Export Partners Import Partners

•USA •USA
•China •China
•UK •Japan
•Japan •Mexico
•Mexico •UK
 What Do They Sell?
• Oil = 19%
• Cars = 15%
• Machines, Engines, Pumps = 7.6%
• Gold & Precious Metals = 4.7%
• Electronic Equipment = 3.2%
CAD = Oil Linked Currency
 Pip Values
1 pip = 1.3025 -> 1.3026
10,000 / 100,000

USD/CAD = $0.75 / $7.54

CAD/JPY = $0.83 / $8.30
EUR/CAD $0.75 / $7.54
GBP/CAD $0.75 / $7.54
AUD/CAD = $0.75 / $7.54
NZD/CAD = $0.75 / $7.54

*As of Sept 2015

 When Does CAD Move?

Canadian Data
8:30AM – 10:00AM ET (12:30 – 14:00 GMT)

US Data
8:30AM – 10:00AM ET (12:30 – 14:00 GMT)

Oil Inventories
Wednesday 10:30AM ET (14:30 GMT)
 Key Economic Reports
1. Employment = Net Change in Employment (Part vs. Full Time)

2. Retail Sales = Retail Sales

3. PMI = IVEY PMI

4. Inflation = Consumer Prices (CPI)

5. GDP = GDP (Monthly and Quarterly)

6. Trade = Trade Balance

7. Central Bank Meetings & Minutes = Bank of Canada Meeting

CAD TRADING TIP #1

Correlation with Oil

CAD/USD and Oil
CAD TRADING TIP #2

USD/CAD Tracks 2 Year

US-CAD Yield Spread
 CAD TRADING TIP #3
USD/CAD Doesn’t Always Rise in Good US
Data!

Because if its good for US, its good for Canada

 CAD TRADING TIP #4

It’s a Risk ON Currency. Rallies

When Stocks Rise
 CAD TRADING TIP #5

Delayed Reaction to CAD Data

Especially on NFP Da
CAD Crosses
New Zealand Dollar
 Background
•Symbol NZ$

•Nickname - Kiwi

•NZD is 10th Most Actively Traded Currency

•NZD/USD is 9th Most Actively Traded Pair

•Export Dependent Economy

 Central Bank
•Reserve Bank of New Zealand (RBNZ)
•Mandate: Maintain Stability and Efficiency of
Financial System
•Created: 1934
•Central Bank Governor: Graeme Wheeler
 More Details ….
Most Important Most Important
Export Partners Import Partners

•Australia •European Union

•China
•China
•European Union
•Australia
•USA
•USA
•Japan
What Does the Economy Rely On?
•Dairy Products – 24.90%
•Meat – 11.59%
•Wood – 6.67%
•Oil – 4.64%
•Fruit – 3.51%
•Mechanical Machinery & Equipment – 3.79%
•Fish – 2.84%
•Aluminum – 2.59%
•Wine – 2.35%
•Electrical Machinery & Equipment – 2.30%
NZD = Soft Commodity Currency
 Pip Values
1 pip = 0.6325 -> 0.6326
10,000 / 100,000

NZD/USD = $1 / $1.00
NZD/JPY = $0.83 / $8.30
AUD/NZD = $0.63 / $6.30
EUR/NZD = $0.63 / $6.30
GBP/NZD = $0.63 / $6.30
NZD/CAD = $0.75 / $7.54

*As of Sept 2015

 When Does NZD Move?

Tokyo Open
7:00 PM ET / 23:00 GMT Tokyo Open
New Zealand Data
4:45 PM ET – 6:45 PM ET (20:45 – 22:45 GMT)
Chinese Data
9:30 PM ET – 1:30 AM ET (1:30-5:30 GMT)
European Open
2 AM ET – 3 AM ET (6-7 GMT)
US Data
8:30 AM ET – 10 AM ET (12:30 - 14 GMT)
 Key Economic Reports
1. Employment = Employment Change (Quarterly)

2. PMI = Business PMI and Performance of Services

3. Inflation = Quarterly Consumer & Producer Prices

4. GDP = GDP

5. Trade = Trade Balance

6. Central Bank Meetings & Minutes = RBNZ Meeting

7. Global Dairy Trade Auction

NZD TRADING TIP #1

Correlation with AUD

AUD vs. NZD
 NZD TRADING TIP #2

Watch the Twice a Month Dairy

Auctions!
NZD TRADING TIP #3

It’s a Carry Trade, Risk On

Currency
NZD/USD Trading Behavior

1. Strong Trend
2. Minimal Retracements
3. Smaller Daily Range
4. Consolidation Break Very
Important
NZD Crosses
Swiss Franc
 Background
• Swissie

• 7th Most Actively Traded Currency

• USD/CHF 7th Most Actively Traded Pair

 What You Need to Know
• 20th Largest Economy in the World

• One of the Wealthiest Countries on Per Capita

Basis

• Leading Industries – Manufacturing, Tourism,

Banking
 Trading Mechanics
USD/CHF Pip Value = $9.80* for 100,000 Units
EUR/CHF Pip Value = $9.80* for 100,000 Units
USD/CHF Average Daily Range = 98 pips
USD/CHF Average Daily Range = 58 pips
SZ Interest Rate = -0.75%
*as of Nov. 2016
 Central Bank
• Swiss National Bank (SNB)
• Created in 1906
• Mandate: Price Stability – Keep Inflation Near 2%
• Frequency of Central Bank Meetings/Year: 4
 Thomas Jordan

More QE and Negative Rates

 Key Swiss Data
1. SNB Rate Decision

2. KoF Leading Indicator

3. UBS Consumption Indicator

4. Retail Sales

5. Unemployment
 Most Active Trading Hours
1:45AM ET to 04:30AM ET / 5:45-10:30 GMT
SZ Data

8:30AM ET/ 12:30 GMT US Economic Releases

 Swiss Trading Tips

• High Margin
• Tight Trading Ranges
• Prone to Intervention
CHF Crosses
Taking out the US Dollar
 Pip Values
EUR/NZD = $0.63 / $6.30
GBP/NZD = $0.63 / $6.30
AUD/NZD = $0.63 / $6.30
EUR/AUD = $0.71 / $7.13
GBP/AUD = $0.71 / $7.13
AUD/CAD = $0.75 / $7.54
NZD/CAD = $0.75 / $7.54
EUR/CAD = $0.75 / $7.54
GBP/CAD = $0.75 / $7.54
NZD/JPY = $0.83 / $8.30
AUD/JPY = $0.83 / $8.30
CAD/JPY = $0.83 / $8.30
 Average Daily Ranges
GBP/NZD = $0.63 / $6.30 432 pips
EUR/NZD = $0.63 / $6.30 372 pips
AUD/NZD = $0.63 / $6.30 144 pips
EUR/AUD = $0.71 / $7.13 305 pips
GBP/AUD = $0.71 / $7.13 300 pips
AUD/CAD = $0.75 / $7.54 116 pips
NZD/CAD = $0.75 / $7.54 127 pips
EUR/CAD $0.75 / $7.54 245 pips
GBP/CAD $0.75 / $7.54 224 pips
AUD/JPY = $0.83 / $8.30 180 pips
NZD/JPY = $0.83 / $8.30 168 pips
CAD/JPY = $0.83 / $8.30 161 pips
What Drives Currency
Crosses?
The Pure Non-USD Trade
contact@bkforex.com