|

AUD/NZD trades at fresh weekly highs above 1.0340 amid risk-off market sentiment

  • AUD/NZD recovers from Monday losses, trades above 1.0350
  • China’s real-estate Evergrande weighs on the market sentiment
  • On Tuesday, the RBA will release its last meeting minutes.
  • RBNZ’s Hawksby: We had more confidence that employment was at its maximum sustainable level

After trading lower on Monday, the AUD/NZD is pairing some of its losses, is trading at 1.0347 up 0.25% at the time of writing. The market sentiment is in risk-off mode caused by China’s Evergrande woes and the Delta variant spread, triggering a flight towards safe-haven assets.

Reserve Bank of Australia minutes to be released at 0130 GMT

The Reserve Bank of Australia will unveil its monetary policy minutes. Despite the Delta variant outbreak in the last month and stringent measures imposed by Prime Minister Morrison, the RBA kept its decision to reduce its weekly bond purchases from A$5 Billion to A$4 Billion, nevertheless extended the duration of the program until at least February of 2022. The latter was due to support the Delta outbreak ongoing in the country.

In the New Zealand economic docket, the RBNZ Assistant Governor Christian Hawkesby hit the wires. He made comments about monetary policy that the statement showed that the bank had more confidence that employment was at its maximum sustainable level. Additionally, he said, “that monetary policy response would be required for future health lockdowns if there was more enduring impact on inflation, employment.”

Read more:  RBNZ’s Hawksby: We had more confidence that employment was at its maximum sustainable level

Later in the day, the NZ Credit Card Spending for August (YoY) and the NZ GDT Price Index will be released. The previous readings were 6.9% and 4%, respectively.

AUD/NZD Price Forecast: Technical outlook

The AUD/NZD is trading well below the daily moving averages, suggesting downward pressure. The pair is trading above the 38.2% of its latest Fibonacci retracement but beneath a downslope trendline that acts as the first resistance level, around  1.0365-70. A break above that trendline could push the AUD/NZD pair towards the 61.8% Fibo retracement level at 1.0386, followed by a challenge to 1.0400.

On the flip side, failure at 1.0365-70, the bears could exert downward pressure on the pair, exposing the 1.0300 level and the possibility of a retest of this year’s lows at 1.0278.

The Relative Strength Index is at 42.06, aiming higher, though it remains below the 50-midline, still supporting the downward bias.

KEY TECHNICAL LEVELS TO WATCH

AUD/NZD

Overview
Today last price1.0347
Today Daily Change0.0026
Today Daily Change %0.25
Today daily open1.0321
 
Trends
Daily SMA201.0383
Daily SMA501.0473
Daily SMA1001.0606
Daily SMA2001.0679
 
Levels
Previous Daily High1.0337
Previous Daily Low1.0287
Previous Weekly High1.0398
Previous Weekly Low1.0278
Previous Monthly High1.0592
Previous Monthly Low1.0338
Daily Fibonacci 38.2%1.0306
Daily Fibonacci 61.8%1.0318
Daily Pivot Point S11.0293
Daily Pivot Point S21.0265
Daily Pivot Point S31.0243
Daily Pivot Point R11.0343
Daily Pivot Point R21.0364
Daily Pivot Point R31.0392

Author

Christian Borjon Valencia

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

More from Christian Borjon Valencia
Share:

Editor's Picks

GBP/USD flirts with two-day lows near 1.3180

GBP/USD remains on the back foot in the latter part of Tuesday’s session, sliding to the sub-1.3200 area and challenging weekly lows. Cable’s decline comes as investors assess the political uncertainty in the UK, coupled with softer-than-expected UK PMI data and the better tone in the Greenback.

EUR/USD weakens below 1.1400 on stronger Dollar

EUR/USD adds to Monday’s losses and recedes below the 1.1400 support to clinch fresh 13-month lows in the latter part of Tuesday’s NA session. The pair’s marked sell-off comes on the back of the persistent move higher in th US Dollar, always propped up by rising bets of further tightening by the Fed.

Gold loses ground to near $4,100 as inflation concerns, Fed rate hike bets build

Gold price loses momentum to around $4,100 during the early Asian session on Wednesday. The precious metal extends the decline as traders cement views on the US Federal Reserve hiking interest rates this year.

Australia CPI set to show inflation accelerated again in May

The Australian Bureau of Statistics will publish the high-impact Consumer Price Index for May on Wednesday at 01:30 GMT. Heading into the inflation test, the Australian Dollar is at its lowest level in two months against the US Dollar, having surrendered the 0.7000 psychological mark.

"Rearranging the deckchairs on the Titanic": UK's fiscal crisis outlasts another Prime Minister

Keir Starmer's resignation as the UK Prime Minister comes ten years after the Brexit referendum vote, a coincidence that financial markets have been quick to note. The British Pound trades around 1.3220 against the US Dollar on Thursday.

Regime change: Inside Kevin Warsh's first move to make the Fed unreadable on purpose

The rate did not move. That was the least interesting thing about Kevin Warsh's first meeting in charge of the Fed. The FOMC held its benchmark at 3.50%-3.75% for the fourth straight meeting, exactly as priced, and then the new chair used his first press conference to dismantle the machinery the market has leaned on for a decade.