HOW TO TRADE FOREX: AUSTRALIAN DOLLAR/NEW ZEALAND DOLLAR (AUDNZD)
The AUD/NZD pair stages a duel between neighbors, showcasing the intertwined yet sometimes divergent destinies of two closely linked economies. Australia and New Zealand share not only geographical proximity but also economic, cultural, and political ties. However, their currencies can take different paths based on the health of key sectors: Australia's reliance on mineral exports and New Zealand's importance of agriculture and tourism. Efficiently trading AUD/NZD requires thorough analysis of both countries' economic reports, as well as an appreciation for external factors that may affect their relationship, such as shifts in global commodity markets or trade policies of major partners.
This pair is particularly intriguing for those looking to capitalize on small fluctuations within a generally stable relationship. Monetary policy announcements from the Reserve Bank of Australia and the Reserve Bank of New Zealand are pivotal moments for traders, offering potential for pronounced movements. A successful trading strategy for AUD/NZD will combine constant monitoring of these economic events with solid technical analysis, allowing traders to leverage short-term and long-term trends.
Top 10 Factors Affecting the Australian Dollar - New Zealand Dollar Pair
Interest Rate Differentials: The policies of the Reserve Bank of Australia and the Reserve Bank of New Zealand directly influence this pair.
Trade Balance: As both countries are commodity exporters, changes in the trade balance can impact AUD/NZD.
Monetary Policy: Interest rate decisions and stimulus measures by each central bank can impact the relative valuation of both currencies.
Commodity Prices: Changes in key commodity prices for both economies, such as dairy products for New Zealand and minerals for Australia.
Key Economic Data: Reports on inflation, unemployment rates, and GDP growth can move this pair.
Global Risk Appetite: Shifts in global sentiment can influence the demand for AUD and NZD, given their export-oriented economies.
Geopolitical and Economic Events in Asia: Due to both countries' strong trade links with Asia, especially with China, events in this region can have a significant impact.
Central Bank Intervention: Any indication of intervention by the central banks in the Forex market can influence the pair.
Natural Disasters: Both countries are susceptible to natural disasters that can have immediate economic impacts.
Economic Growth Differentials: The relative economic growth rate between Australia and New Zealand can affect the strength of their currencies.
Related Assets Influencing the Dynamics of the AUD/NZD Pair
Dairy Product Prices: Critical for the NZD, as New Zealand is the world's largest exporter of dairy products. Higher prices can strengthen the NZD against the AUD.
Iron Prices: Important for the AUD, as Australia is a world leader in iron exportation, benefiting the AUD with higher prices.
Copper Prices: Similar to iron, copper benefits the AUD when prices rise, due to Australia's status as a significant exporter.
ASX 200 Index: An indicator of Australia's economic health. Upward trends in this index can benefit the AUD.
NZX 50 Index: Shows the economic health of New Zealand. A rising index may signal a strengthening NZD against the AUD.
Top FX Trading Apps
Opening a FX Trading Account
Select a Reliable Broker: Research and choose a broker that meets your expectations regarding trading tools. The security of your funds should be your priority.
Registration: Go to the broker's website and find the option to register a new account. You will need to provide basic personal information, such as name, email address, phone number, and, in some cases, an ID document to verify your identity.
Account Verification: Brokers require a verification process to comply with anti-money laundering regulations. This usually involves uploading documents such as a photo ID and proof of address.
Initial Deposit: You can make your first deposit once your account is verified. Brokers offer different payment methods, including bank transfers, credit/debit cards, electronic payment systems, and even cryptocurrencies. Returning to point 1, if you have specific needs like "I can only use brokers that accept payment method XYZ, " choose the broker that fits your needs.
Trading Platform: With your account funded, you can now access the broker's platform. If you haven't already, now is the time to familiarise yourself with the platform. Take advantage of the demo account if it's available. It allows you to practice your trading strategies, an advantage not only for beginners but also for experienced traders who are testing new strategies or simply seeing the execution and advanced features the trading app offers.
Set Up Your Trading Space: Customize the platform according to your preferences. This includes selecting the financial instruments you plan to trade, setting up charts, and implementing any technical indicators you regularly use.
Trading Strategy: If you haven't already, define your trading strategy, including risk management. Setting loss limits and profit targets can help you keep your trading disciplined and focused on your long-term goals.
First Trades: With everything in place, you can start trading.
BlackBull Markets, founded in 2014 by Michael Walker and Selwyn Loekman in Auckland, New Zealand, has emerged as a trusted and regulated ECN broker offering access to diverse tradable instruments. BlackBull Markets stands out with its three distinct types of ECN accounts, catering to traders' varying needs and preferences: Standard Account, Prime Account, and Institutional Account.
The Standard Account is an excellent choice for traders seeking a cost-effective forex experience. It offers a convenient entry point without minimum deposit requirements and commission-free trading. Traders can access all tradeable instruments and utilize user-friendly trading platforms, including PC, Mac, mobile, and Webtrader.
The Prime Account provides a competitive edge for those looking to maximize their trading potential. With spreads as low as 0.1 pips and a commission of $6 per lot for most currency pairs, traders can benefit from tighter spreads and lower costs. The Prime Account requires a minimum initial deposit of 2000 USD and offers leverage of up to 1:500, along with micro lots for precise position sizing.
BlackBull Markets also caters to larger traders with its Institutional Account, providing a truly institutional trading experience. With a minimum initial deposit of 20,000 USD, traders can access customisable commission structures, 24/7 dedicated technical support, and a customised MAM/PAMM platform. Qualifying traders can benefit from free VPS access based on trading volume.
Regulation is key to BlackBull Markets' offering, ensuring a secure and transparent trading environment. Prominent authorities regulate the broker, including the Financial Services Commission of New Zealand (FSPR).
With a commitment to exceptional financial services and a focus on client satisfaction, BlackBull Markets has garnered a strong reputation within the industry. Their comprehensive range of over 26,000 tradable instruments, competitive trading conditions, and reliable customer support positions them as a top choice for traders seeking a trusted ECN broker.
Trading foreign exchange on margin 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 foreign exchange, 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 you cannot afford to lose. You should make yourself aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any questions or concerns as to how a loss would affect your lifestyle.
