How the pros trade central bank events

Added: 2026-06-01

[00:00:00]This is how professionals trade central bank events. So, I took a sell on NZUSD because in a couple of hours we have the RBNZ meeting. RBNZ is the central bank of New Zealand. I am betting that this meeting turns out more dovish than people expect and that the New Zealand dollar sells off. The main reason I think that is look at what is priced in for the RBNZ in terms of hikes. So they have 76 basis points of hikes priced in by the end of 2026. That is much higher than most of the other central banks.

[00:00:35]And if you look at the actual data in New Zealand, their economy is not doing well. Here is the GDP growth. So it's 0.2% in the last two prints. That is very low. That is very bad. Next we have the CPI which is at 3.1%. This is inflation but it's not that much higher than all of the other economies. Then we have the PPI which is not elevated. It is at 0.8% which is not that bad. And the last part, the worst part about the New Zealand economy is the unemployment rate. Look at this number. It's 5.3% and is definitely rising. So it's on an uptrend. So the RBNZ is scheduled for Wednesday this week, which is in just a few hours. And because of these reasons, because the economy in New Zealand is not doing well, because the GDP is bad, because the unemployment rate is high and rising, I don't think they will announce 76 basis points of hikes this year like the market expects them to do.

[00:01:30]So I believe the meeting turns out more doubbish. And of course, the New Zealand dollar sells off on this news. So, I entered already at 0.58730, stop loss 0.59411 and a takerit of 0.57493.

[00:01:46]This trade is already working pretty well and the meeting hasn't yet happened. So, after the meeting, I'm expecting a meltdown to the takerit level. Now, of course, the price can go up. I can get taken out for a loss, but I think the probabilities are the meeting turns out more doubbish and NCUSD sells off. By the way, this was a signal in the Livermore Trading Discord.