Paladin

Hi people!

OK its Good Friday but its not looking like a Good Pound/NZ Dollar Day I'm afraid!

I've just been reviewing the charts and on the 1 hour chart particularly, there appears to be a probable downtrend consolidation continuation pattern developing.
In plain english, this means the exchange rate is probably headed even lower as I suspected and previously posted. Its looking like my projections of a fall to the $2.66 area may well come about! It may take a little while to hit this target or it may zoom down there next week - all we can do is wait and see. As I said before, the big institutional currency traders are looking at the same charts I am and they will see $2.66 as a big real target at a sensible support level(details of which I won't go into LOL!)

Sorry folks!

Dave

SarahB

hmmmmm ok. Why cant you bring us some good news!

Our house sale in UK has gone through this week and the cheque is in the building society... we are leaving money there for now and hoping for the best.

Paladin

Sorry Sarah!!

It may not be good news for those wishing to move money from the UK to NZ, but at least I hope the information(opinions!) will be of some use. Forewarned is forearmed and all that!

I'm not trying to bum people out on purpose LOL! Honest!!!

Have a great weekend!

Dave
x

GowHow

Sounds a good idea. I am no expert, in fact I have no knowledge at all on the subject! but when we went to NZ on holiday last year in Feb, the rate (tourist) was about £2.70, since then it has been as high as £3.06 and back down again. I reckon some time in the next year or so it will be back at $3

We are planning to do the same with our money - leave it in the UK until the rate is better

Fingers crossed

SarahB

I was lucky last year when I sold my little one bed house in UK... I got 3 dollars to the pound.

But I can see why my OH wants to leave his money in the UK for now. We get some interest on it so its not all bad.

Paladin

Well its a fairly safe way to play it although in reality you will still lose money as inflation(the REAL rate of inflation, not the phony figures the government puts out!) means that the real rate of return on cash in the bank is actually NEGATIVE these days!!

You could always invest the money elsewhere for a while in something safe! Physical gold or silver in your possession could be a good idea!

Remember when Brussel_Sprout was harassing me about my views on gold a couple of months or so ago when gold was about $570-580/oz?

Well its now $675/oz and climbing! Thats up 17% or so! And that IS higher than even the REAL inflation rate!!! Plus the independent gold analysts now pretty much universally agree the new floor is in on the price of gold at ~$600/oz so theres very limited downside risk. Gold isn't like some paper asset like shares - its value will NEVER drop to zero!!! The current very short-term upside target is $710/oz in the current up trend price channel, but long term four digits minimum LOL!( the current up trend price channel has a floor of ~$640/oz).

Anyway, I don't know your financial situation so am not directly recommending you buy gold - just saying why not look into other safe forms of investment as an option to just leaving your money sitting in the bank losing purchasing power!

Food for thought!

Dave
x

Paladin

BTW, for those of you keeping a close eye on the GBP/NZD exchange rate; possibly the biggest risk to the strength of the NZD is the possiblility of the unwinding of the Yen Carry Trade, so you might also keep an eye on the NZDJPY exchange rate too!!! Strength in the Yen will spell potential weakness in the NZD!!!

Dave

Fireman Al

Thanks for some serious info on this thread mate, your wisdom and knowledge greatfully appreciatted. This might seem like a silly question but i have approx 100k in bank account back in uk and am waiting for the exchange rate to rise in my favour (not holding my breath at mo !!), but, if the U.S Housing market crashes, will it bring down kiwi dollar rates etc....or should i go buy us dollars if it crashes and xchange at a later date to make some cash !!!!

Ali

Paladin

Well if you believe the US$ is gonna crash due to the impending US housing crash, then you would want to buy physical US$ now and then buy back your physical £ later when the exchange rate drops!! Kerrrrrching!!!

Personally I won't pay the buy/sell spread on physical currency exchange because its way too high for my liking which is why I have a forex broker account where everything is just computer denominated!! And they run on margin of usually 1% so you can trade waaaaay more than you physically own if ya like that kinda risk exposure!!! My spread between buy/sell price on GBP/USD is only 3/100ths of a cent(3 "pips" as its called)!!! If you have a forex account then you just Short the GBPUSD pair!!! Kerrrrrching!

Exactly what effect there would be in this situation on the NZ$ is dependent on a whole bunch of factors, not just the the strength of the US$.

And you are very welcome to the info - I would never claim that my opinions, projections etc will be correct 100% of the time as the currency trading world is no exact science, but if you can be right 60%+ of the time you make nice dosh!!

Dave

Paladin

Hey if any of you nutters are about at 1.30pm GMT, check what happens when the Non Farm Payrolls(NFP's) data is released in the USA!! Liquidity is thin due to the start of the Easter Holidays(ie many traders are away from their trading desks) so there could be BIG fireworks depending on how the data looks!!
NFP's are the biggest market moving economic news release on the calendar & they come out on the first Friday of every month!
Its the only reason I am working today rather than painting the fences and shed ready for selling our house for the move to NZ!!!

Oh what a sad life I lead!!

Paladin

Oh well there goes the neighborhood!!

NFP's came in alot higher than expected BUT the unemployment rate also dropped - a double whammy = strength for the US$ and weakness for the GBP AND EURO versus the greenback.

The NZ$ is benefiting from GBP weakness with the GB£/NZ$ rate having already instantly hit a new low for this down trend at $2.7164..... oh deary me!!!
The £ is down 60c against the US$ and the Euro 50c already and they're all headed south!!!

Looks like another nail in the coffin for potential lower interest rates in the US and therefore one more nail in the coffin of the US housing market so get ready for the US to sneeze and the rest of us to catch a cold real soon!!! Sell your houses in the UK while you've still got the chance if you're headed to NZ IMHO!!!

Dave

Paladin

Further thoughts:

The Bank of England kept UK base rates on hold yesterday at 5.25% BUT market analysts are now pricing in a high probability of a UK rate rise in May(first Thusrday in May) SO;

1. This will possibly put a halt to the slide of the £ vs. the NZ$, so expect a possible bottoming out somewhere in the $2.66-2.71 range. Personally I'm betting on the lower end of that range in an exhaustion phase!

2. That UK rate rise, if it happens, will put further pressure on the UK housing market on top of any pressure coming from the US housing market slump.

3. The currency markets and bond markets are pricing in higher US interest rates. The inverted yield curve on US Treasury Bonds is unwinding as we speak! If you want to know what's really going to happen on the interest rate front - watch the currency markets and bond markets! The stock market is no good to you - its manipulated to all hell! If ya don't believe me, google "Plunge Protection Team" and you'll find out more!!! All this translates into one helluva problem for the US housing market on top of the sub-prime mortgage debacle; which in itself is going to knock on to the Alt-A and Prime mortgage markets too = mega slump is a coming in US housing - watch out! Its catching and will spread across the ponds to our housing markets as liquidity dries up, lending parameters are tightened and sellers start to outnumber buyers = house price drops soon!

Translation: maybe you want to get your UK house sold in the busy Spring & Summer house selling/buying season before all hell breaks loose! IMHO!!!!

Food for thought!

Dave

Kippers

????
Why would you buy the $US high and then sell low.
Surely you would lose money doing that?

Incidently Dave. After you've sold your house in the UK and converted the proceeds to gold bullion, I was wondering how you're going to get that through customs at Auckland airport.

Also, do you need a hand carrying it to your new digs in Nelson


Kip

Paladin

Hi Kip,

Yeah the confusion here is that Ali was asking about exchanging CASH !!!!

To make it simple: Lets presume the current exchange rate of USD to GBP is $2.00. If Ali takes his £100k CASH and BUYS US$ now he will have $200k. Now if the exchange rate then falls to lets say £1 = $1 over 6 months then his $200k will get him £200,000 !!! He doubled his money!!!

This is not to be confused with what you would do if you had a forex broker acct as I do for my trading. As I said in the original post, what you would do then is just Short the USD pair, ie SELL it!! In this situation you are selling and then buying back at a lower price to book your profits. In a forex acct you are effectively operating on the opposite of a cash position on the GBP/USD pair BECAUSE the GBP is the base currency!!! Its just a giant computerized gambling arena LOLOL!!!!

As for converting house proceeds to gold, well IF I did that, there's ways and means to avoid having to cart a load of gold past NZ Customs! Offshore storage, digital gold later converted to physical with people like Goldmoney.com etc etc.

And you keep away from my luggage!!!

Dave

karonious

And you keep away from my luggage!!!

Dave


We have arranged to pick your luggage up with our new 'Tradme' forklift. Get yourself a taxi or whatever........, your luggage will be very safe with me.