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Forex Analysis: NZD vs. USD 

New Zealand controls one third of the world dairy and meat products. Therefore, the country’s financial system is focused on the agriculture.The traders should observe economical trends such, as, for instance, a decline in the dairy output in the US as a result of natural disasters or other reasons and the increased demand for the NZ exports. Of course this scenario causes the NZ dollar to appreciate in value in relation to the US dollar.To benefit from this, traders buy (Ask) the NZD/USD currency pair.

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Another example is a widespread of the "foot and mouth" disease which causes a decline in dairy and meat production in New Zealand. The subsequent effect is depreciating of the NZ dollar. The forex traders then sell (Bid) the NZD/USD currency pair. Of course, these examples are simplified scenarios designed for forex beginners. However, they give an idea of what how a straightforward and simple fundamental analysis could help.

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