Three Reasons Why Trading with the Kiwi Can Be Beneficial

While many traders focus on more common currency pairs like USD or EUR, the New Zealand Dollar, also known as the Kiwi, holds considerable potential. There are three reasons why trading with the Kiwi could be a profitable choice:

1. Positive Economic Data from New Zealand 

Often, investors tend to pay attention to economic growth in the United States or economic recovery in the European region. However, economic data from New Zealand often demonstrates noticeable stability and positivity. Recently, the ANZ business confidence has increased significantly, and various other economic indicators such as inflation, trade balance, and employment rates also show promising signals. Despite being influenced by economic conditions and commodities in China, which is New Zealand's major trading partner, the Kiwi continues to show sustained strength.

2. No Threats from RBNZ 

Unlike central banks in other countries that tend to intervene when their local currency is too strong, the Reserve Bank of New Zealand (RBNZ) is more inclined to let the market run more naturally. RBNZ Governor Wheeler has a policy that emphasizes setting limits on central bank resources rather than direct intervention in currency exchange rates. This creates a more stable and predictable environment for traders trading with the Kiwi.

3. Greater Profit Potential with the NZD/USD Pair 

By looking at the daily chart of NZD/USD, it can be seen that this currency pair has recently bounced from the 200 SMA level and mid-channel long-term support. This condition provides opportunities for traders to gain significant profits if prices break through the channel peak, with balanced risk ratios. However, it's important to remember that the market is always changing, and there are no guarantees. Therefore, good risk management remains key in trading activities.

Considering these three reasons, trading with the Kiwi can be an attractive choice for traders. However, as a wise step, it's always important to remain vigilant and observe possible changes in market conditions.

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