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FxWirePro: AUD/NZD downside pauses shy of 100-DMA, bias lower, stay short

  • Kiwi cheers stronger-than-expected inflation data, NZ CPI rose 2.2% y/y in Q1, beating forecasts at 2%.
     
  • Risk-on back into markets as oil prices recovered from heavy sell-off seen in the US last session, also supporting the NZD.
     
  • AUD/NZD breaks major trendline support at 1.6890, price action is holding cloud base support at 1.0643.
     
  • Break below cloud base finds next major support by 100-DMA at 1.0628. 
     
  • Violation at 100-DMA could see weakness upto 200-DMA at 1.0579.
     
  • Technicals on weekly charts are also heavily bearish, Stochs and RSI are biased lower and MACD is on verge of a bearish crossover.
     

Call update: Our short call (http://www.econotimes.com/FxWirePro-AUD-NZD-finds-strong-support-at-10740-good-to-go-short-on-break-below-646403) has hit TP1&2.
 

Recommendation: Bias lower. Hold for downside. Target 1.0630/ 1.0615/ 1.0580

FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at -86.9037 (Bearish), while Hourly NZD Spot Index was at 8.37586 (Neutral) at 0540 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex
 

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