AUD/NZD up 0.09% on the day as Aussie bulls take control

Currently, AUD/NZD is trading at 1.0693, up 0.09% on the day, having posted a daily high at 1.0709 and low at 1.0681.

AUD/NZD has taken off with the recovery in the Aussie dominating the antipodeans after Fed chair Yellen delivered a bullish case for the economy and hawkish rhetoric on behalf of the FOMC. This knocked the wind out of the kiwi and Aussie temporarily, but the market simply remains long of the commodity bloc despite a resurgence in the greenback.

In respect to the kiwi, it has a strong run this year so far with the NZ economy stronger than anticipated so far. Dairy prices have risen as well. However, the cross retains positive momentum, as noted by analysts at Westpac who said that it comes with the potential for a break above 1.0700 to 1.0765 (14 Oct high). "Strong iron ore prices provide near-term fundamental support."

AUD/NZD 1-3 month: 

The same analysts expect the cross to go higher to the 1.0650-1.0770 area, mainly for valuation reasons. "The cross remains well below fair value estimates implied by interest rates, commodity prices and risk sentiment."

Aussie Data:

Australian Consumer Confidence Index for Feb came out +2.3% m/m to 99.6 vrs prior +0.1% to 97.4. We also had Alexandra Heath, the Head of Economic Analysis Department at the Reserve Bank of Australia taking earlier who was optimistic in respect of the Australian economy and is expecting inflation to pick up.

AUD/NZD levels

Current price is 1.0693, with resistance ahead at 1.0701 (Daily Classic R2), 1.0724 (Daily Classic R3) and 1.0768 (Weekly Classic R1). Next support to the downside can be found at 1.0685 (Hourly 20 EMA), with next key level at 1.0689 (50 hourly sma) and on the wide we have 1.0528 (200 hourly smoothed ma).