AUD/NZD: 30 pips down from recent high as traders await China data-dump

New Zealand CPI triggered the pair’s rally but buyers are still cautious ahead of China data.
A successful break of 200-day SMA can challenge 1.0755/65 area including late-2018 highs.

Anil Panchal FXStreet

AUD/NZD trades near 1.0680 during initial Asian sessions on Wednesday. The quote previously surged to the highest since November 2018 after New Zealand CPI disappointed Kiwi buyers. However, buyers booked some of the profits ahead of the key China data-dump.

New Zealand Dollar (NZD) dropped across the board after quarterly consumer price index (CPI) data strengthened expectations of May month rate-cut from the Reserve Bank of New Zealand (RBNZ). The Q1 2019 CPI grew 0.1% versus 0.3% on a quarterly basis while registering a 1.5% increase compared to the 1.7% market consensus on YoY format.

Even if China data is important for antipodeans as a whole, the Australian Dollar (AUD) is likely to benefit more as the dragon nation is Australia’s largest customer.

The data-dump includes first quarter (Q1) 2019 gross domestic product (GDP) and March month annualized figures of retail sales and industrial production releases from the world’s largest industrial player and the biggest commodity user.

Forecasts suggest welcome prints from retail sales and industrial production to confront soft GDP outcome. Retail sales growth could increase to 8.4% from 8.2% while industrial production may also register expansion by 5.9% versus 5.3% prior. Additionally, GDP YoY may soften to 6.3% from 6.4% whereas quarterly growth figures may decline to 1.4% from 1.5% earlier.

In addition to China data, developments surrounding the on-going trade talks between the US and China could also direct near-term moves of the pair.

AUD/NZD Technical Analysis

AUD/NZD needs to hold its break beyond 200-day simple moving average (SMA) level of 1.0685 in order to aim for 1.0755/65 area including late-2018 highs whereas 1.0800 and 1.0840 can entertain buyers then after.

Meanwhile, quote’s dip beneath, 1.0670, including January high, can recall 61.8% Fibonacci retracement of August 2018 to January 2019 downpour, at 1.0600, on the chart.

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

EUR/USD weakens to near 1.1900 as traders eye US data

EUR/USD eases to near 1.1900 in Tuesday's European trading hours, snapping the two-day winning streak. Markets turn cautious, lifting the haven demand for the US Dollar ahead of the release of key US economic data, including Retail Sales and ADP Employment Change 4-week average.

GBP/USD stays in the red below 1.3700 on renewed USD demand

GBP/USD trades on a weaker note below 1.3700 in the European session on Tuesday. The pair faces challenges due to renewed US Dollar demand, UK political risks and rising expectations of a March Bank of England rate cut. The immediate focus is now on the US Retail Sales data.

Gold sticks to modest losses above $5,000 ahead of US data

Gold sticks to modest intraday losses through the first half of the European session, though it holds comfortably above the $5,000 psychological mark and the daily swing low. The outcome of Japan's snap election on Sunday removes political uncertainty, which along with signs of easing tensions in the Middle East, remains supportive of the upbeat market mood. This turns out to be a key factor exerting downward pressure on the safe-haven precious metal.

Bitcoin Cash trades lower, risks dead-cat bounce amid bearish signals

Bitcoin Cash trades in the red below $522 at the time of writing on Tuesday, after multiple rejections at key resistance. BCH’s derivatives and on-chain indicators point to growing bearish sentiment and raise the risk of a dead-cat bounce toward lower support levels.

Follow the money, what USD/JPY in Tokyo is really telling you

Over the past two Tokyo sessions, this has not been a rate story. Not even close. Interest rate differentials have been spectators, not drivers. What has moved USD/JPY in local hours has been flow and flow alone.

Bitcoin Cash trades lower, risks dead-cat bounce amid bearish signals

Bitcoin Cash (BCH) trades in the red below $522 at the time of writing on Tuesday, after multiple rejections at key resistance. BCH’s derivatives and on-chain indicators point to growing bearish sentiment and raise the risk of a dead-cat bounce toward lower support levels.