AUD/NZD trying to stage a climb once again after falling in yesterday's risk-off mood

Markets lost their risk appetite and the Aussie swung back against the Kiwi, erasing yesterday's gains.
The pair is climbing in the overnight session but downside risks remain heading into Friday.

Joshua Gibson FXStreet

The Aussie rose and then fell against the Kiwi in Thursday's trading, ending the day flat and the pair now hovers near 1.0635.

The AUD/NZD had a steady run-up this week, climbing to a high of 1.0672 before markets reversed direction yesterday, knocking the pair back. The Aussie has fallen back under April's initial high, and the AUD is likely to continue dragging its heels after a dismal jobs report yesterday that leaves the Australian currency exposed to further downside as hopes of a stable economic recovery begin to look dim.

Economic recovery has been a middling affair for both Antipodean currencies, with the Australian and New Zealand economies lagging behind global growth trends, but the Australian factor continues to be on the glum side compared to the ever-hopeful Kiwi's disposition.

The AUD/NZD has maintained a bearish trend since peaking at 1.1290 in October of 2017, and a rejection from this level would price in yet another lower high for the pair, leaving it exposed to further downside looking foward.

AUD/NZD Levels to watch

Thursday's peak-and-drop signals a rejection from the 50-day EMA at 1.0670, and failure to continue capturing higher territory would see the pair begin a new leg down on the main bear trend. On the flip side, a bounce from the 50.0 Fibo level at 1.0580 could see a higher low priced in for the pair, and a bullish trend could get a chance to kickstart from that area, provided the Aussie could gather enough momentum to climb over resistance at 1.0670.

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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