AUD: On recovery path - BBH

Sandeep Kanihama FXStreet Contributor

The easing of trade tension helped accelerate the Australian dollar's recovery and it has strung together the first back-to-back weekly advance since January, points out the research team at BBH.

Key Quotes

“It had taken the better part of two weeks to carve a low near $0.7630. As recently as April 9 it was near $0.7650. Before the weekend it briefly traded above $0.7800 for the first time in nearly a month. It was rebuffed ahead of the 61.8% retracement of the leg down that began in the in middle of March. The technical tone would deteriorate if the Aussie were pushed back below the $0.7740 area.”

“We had previously noted that the Australian dollar was testing a three-year-old uptrend against the New Zealand dollar (~NZD1.05). The trendline has remained intact even if marred, and the technical tone is improving. A move now above the 20-day moving average (~NZD1.06) could boost confidence that a durable low is in place. Short-term participants see the Kiwi is as more immune from the trade wars than the Aussie, making the cross a trade play.”

Author

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

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