- 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.
