The New Zealand Unemployment Rate is an event risk that is being monitored by currency traders across the globe.
It gauges the percentage of the entire work force that is unemployed and actively seeking employment during the prior quarter.
Fundamentally speaking, a higher than expected reading is seen as being bearish or negative for the New Zealand Dollar, whereas a lower than expected reading is seen as bullish or positive for the New Zealand Dollar.
The New Zealand Unemployment Rate trading strategy is a technical approach that allows anyone benefit from the massive price actions witnessed during such new releases.
MetaTrader4 Indicators: Fractal_dimension.ex4 (e period value, 40), Easy-forex-system.ex4 (width & color modified)
Preferred Time Frame(s): 1-Minute, 5-Minutes, 15-Minutes
Recommended Trading Sessions: After news release
Currency Pairs: NZD/USD (best to trade)
Trade Example (Click the picture for full size)
Long Entry Rules
Place a long entry when the following rules are intact 20 minutes after the news release:
- If the line of the Fractal dimension custom indicator turns blue and pushes pass the 1.5 level, a bullish signal is ripe.
- If candlesticks form above the blue line of the Easy-forex-system custom indicator, it is an indication that price is pressured higher, giving rise to a buy signal.
Stop Loss for Long Entry: Place stop loss 3 pips below short term support.
Exit Strategy/Take Profit for Long Entry
Conditions for an exit or take profit is as follows:
- If the blue line of the Fractal dimension custom indicator dips below the 1.5 level and turns red, it is an exit or take profit trigger. An early exit or take profit is advised when the Fractal dimension custom indicator line turns red.
- If a bearish candle closes below the blue line of the Easy-forex-system custom indicator, an exit or take profit is appropriate.
Sell Entry Rules
Make a sell entry 20 minutes after the news release in line with the under listed rules:
- If the red line of the Fractal dimension custom indicator falls below the 1.5 level, it is an indication of a sell entry.
- If price bars forms below the yellow line of the Easy-forex-system custom indicator, a sell is in place.
Stop Loss for Sell Entry: Place stop loss 3 pips above short term resistance.
Exit Strategy/Take Profit for Sell Entry
The following conditions or rules will define our exit or take profit:
- If the Fractal dimension custom indicator line turns red, it is a signal of an upward push i.e. price reversal, thus an exit or take profit is advised.
- If price closes above the yellow line of the Easy-forex-system custom indicator, an exit or take profit should be considered.
About The Trading Indicators
The Fractal_dimension.ex4 custom indicator does not define trend direction, rather it shows if the market is in volatility or in a trend. The primary function of the indicator is to determine market volatility.
Finally the Easy-forex-system.ex4 custom indicator aids traders in determining the directional bias for a specific forex pair within a given time frame. The indicator is comprised of three smoothed moving averages.