AUD/NZD – The AUD Probing Key Support at 1.10

AUD/USD (1.0961)

Some points to consider in this Forex market:

• AUD/NZD Forex market break lower challenges key support levels at 1.1010 and 1.10.
• Event risk on tap this week, NZD bond sale comes in better than expected.
• Weak Australian data weakens the AUD

I have been interested in the AUD/NZD Forex market since the break and close near the key slope resistance level that lined up at 1.0725. This had shifted the market to the topside. This advance has now tested a key confluence region that is near 1.1010 to 1.1019/20. However we did get key event risk today that strengthened the New Zealand Dollar and weakened the Australian Dollar. A better than expected 2020 bond sale out of the Reserve Bank of New Zealand (RBNZ) and a record setting weakness in CAPEX was released out of Australia.

Technical Analysis

Let’s discuss today’s technical analysis in the AUD/NZD Forex market. There is near term support lining up at 1.0910 and a bit lower higher up at 1.0920. A daily close above these technical support levels challenges the technical resistance levels lining up at 1.1115 then the trend line resistance level at 1.13. This is the trend line that dates back to the March 2011 high.

Notes to Consider in the AUD/NZD Forex Market

The AUD/NZD market has been trading within a well-defined consolidative zone with a pull back at the supports of 1.1010 and 1.1020. A daily close below these technical levels challenges the technical support lining up at 1.0965 then 1.0920. We need to see a close below 1.0860 to shift the bias back towards bearish.

There is interim technical resistance lining up at 1.1079/80. A daily close above this level challenges 1.1112, which is the upper consolidative range.

Until I see a notable shift and increase in the available trading range (ATR) in this Forex market, I will remain neutral as their are no long term carry trades available at this time.