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Aud-nzd

AUD NZD - FUNDAMENTAL DRIVERSAUD FUNDAMENTAL OUTLOOK: NEUTRAL BASELINE Despite a decent recovery from the start of the year, the AUD has struggled in the midst of underlying negative risk sentiment, China’s continued struggles with Covid breakouts, and more recently the big slump in key commodities (Iron Ore & Coal). China’s economy is always a key focus for the AUD. While all major economies are expected to slow in 2022, China is expected to recover (monetary and fiscal policy very stimulative). The expected recovery has been a key focus for our previous bullish AUD bias, which worked out well until a few weeks ago. Our view was that China’s expected recovery would be enough to keep commodities like Iron Ore supported even while other commodities push lower on global demand concerns, but price action has proven us wrong on that assumption, with Iron Ore dropping close to 30% from the mid-June. The RBA which finally started their hiking cycle has also failed to provide much support for the AUD, with recent comments suggesting the bank isn’t ready to confirm the aggressive number of hikes that STIR markets have already priced in. While Iron Ore prices stays pressured and covid lockdowns in China persists, we are moving our bias to neutral for the AUD. The only reason why we haven’t shifted to bearish is because the recent data out of China has been better than expected, and still poses upside risks for the currency if things like Iron Ore can put in a base and show some recovery. POSSIBLE BULLISH SURPRISES Positive Covid developments in China (easing restrictions, more fiscal or monetary stimulus, or letting go of the covidzero policy) could trigger bullish reactions in the AUD. As a risk sensitive currency, catalysts that causes big bouts of risk on sentiment could trigger bullish reactions in the AUD. Any catalyst that triggers some recovery in Australia’s key commodity exports (China stimulus, lifting covid restrictions, new infrastructure projects in China, higher inflation fears) should be supportive for the AUD. With the RBA just getting started with their hiking cycle, there is scope for them to turn more aggressive, which means any overly triggers (CPI this week) or hawkish comments or actions from them could trigger some bullish reactions. POSSIBLE BEARISH SURPRISES Negative Covid developments in China (increasing restrictions or adding new ones) could trigger bearish reactions in the AUD. As a risk sensitive currency, catalysts that causes big bouts of risk off sentiment could trigger bearish reactions in the AUD. Any catalyst that triggers more downside in Australia’s key commodity exports (additional China restrictions, demand destruction fears, and additional news on recent centralized iron ore buyers) could be negative for the AUD. Despite CPI >5% we’ve recently heard typical stubbornly hesitant comments pushing back against aggressive tightening implied by STIRs. Thus, any overly dovish comments or potential data triggers (CPI this week) can trigger bearish reactions in the AUD. BIGGER PICTURE The bigger picture outlook for the AUD is neutral for now, but that is largely dependent on what happens to China and whether key commodities like Iron Ore and Coal can stop their recent bleeding. Until the covid situation improves materially and until commodities stabilize, the AUD might struggle to maintain upside momentum. NZD FUNDAMENTAL OUTLOOK: NEUTRAL BASELINE Despite the RBNZ being one of the most hawkish central banks from 2021, it hasn’t been enough to provide any meaningful trending support for the NZD. The cyclical concerns for the global economy, alongside concerns from China regarding their struggles with their covid-zero policy as well as recent big falls in commodity prices has kept the NZD pressured. Even though the RBNZ is expecting to keep their hiking cycle intact as they proved at their July meeting, some mild economic concerns have been starting to show up in the recent data, something they alluded to in their statement as well by noting medterm downside risks for the economy. Recent data such as consumer and business confidence has confirmed this view. Furthermore, a big focus for the RBNZ’s aggressive policy (apart from high inflation of course) has been to try and calm down a very hot housing market, and even though the fall is small we have seen YY house prices cool starting to cool down. These developments on the growth side are not expected to stop the RBNZ’s hiking cycle just yet, but some market participants are expecting a more dovish tone reflecting these concerns and a push back in hike expectations in the months ahead. POSSIBLE BULLISH SURPRISES Tactical positioning looksstretched, and trading at these levels it increases possibility of some mean reversion or position squaring which could trigger some upside in the NZD. Positive Covid developments in China (easing restrictions, more fiscal or monetary stimulus, or letting go of the covidzero policy) could trigger bullish reactions in the NZD. As a risk sensitive currency, and catalyst that causes big bouts of risk on sentiment could trigger bullish reactions in the NZD. Any catalyst that triggers some recovery in commodity markets (China stimulus, lifting covid restrictions, new infrastructure projects in China, higher inflation fears; lower growth concerns) should be supportive for the NZD. POSSIBLE BEARISH SURPRISES Negative Covid developments in China (increasing restrictions or adding additional ones) could trigger bearish reactions in the NZD. As a risk sensitive currency, and catalyst that causes big bouts of risk off sentiment could trigger bearish reactions in the NZD. Since a lot of policy tightening has been priced into STIR markets, any negative catalysts that triggers less hawkish RBNZ expectations (faster deceleration in growth or inflation) could trigger downside for the NZD. Any catalyst that triggers more downside in commodity markets (additional China restrictions, demand destruction fears, further growth concerns) could weigh on the NZD. BIGGER PICTURE The bigger picture outlook for the NZD is neutral for now, but that is largely dependent on what happens to China as the New Zealand economy is also very dependent on trade with China and Australia, and also dependent on whether the RNBZ sticks to their hawkish tone or pivots more dovish in the meetings ahead. Given the RBNZ’s current outlook and stretched positioning, we would favour short-term upside catalysts over trying to chase the currency lower in the short-term.
by thunderpips
2
AUDNZD moving to a new recent high? 🦐AUDNZD on the 4h chart is trading above a daily resistance. The price after the test of the 0.5 Fibonacci level break above. How can i approach this scenario? I will wait for a potential break of the minor resistance and if the market will break above i will consider a nice long order according to the Plancton's strategy rules. --–– Follow the Shrimp 🦐 Keep in mind. 🟣 Purple structure -> Monthly structure. 🔴 Red structure -> Weekly structure. 🔵 Blue structure -> Daily structure. 🟡 Yellow structure -> 4h structure. ⚫️ Black structure -> <4h structure. Here is the Plancton0618 technical analysis , please comment below if you have any question. The ENTRY in the market will be taken only if the condition of the Plancton0618 strategy will trigger.
Long
by InkyGrip
4
AUDNZD can move lower 🦐AUDNZD on the daily chart is moving between 2 structures and currently testing the lower one. The price after the attempt to break the upper level melted below for a test of the lower support area. How can we approach this scenario? We will wait for the break of the support zone and after that, we will check for the application of the Plancton Academy rules to set a nice short order for our usual risk-reward ratio. --–– Follow the Shrimp 🦐 Keep in mind. 🟣 Purple structure -> Monthly structure. 🔴 Red structure -> Weekly structure. 🔵 Blue structure -> Daily structure. 🟡 Yellow structure -> 4h structure. ⚫️ Black structure -> <4h structure. Here is the Plancton0618 technical analysis , please comment below if you have any question. The ENTRY in the market will be taken only if the condition of the Plancton0618 strategy will trigger.
Short
by InkyGrip
AUDNZD Channel Up vs Head and ShouldersThe AUDNZD pair has been trading within a Channel Up ever since the November 19 2021 Low. Two upper and lower tolerance levels of 1.236 and -0.236 have been accounted for. This time though, as the price is trading around the 1D MA50 (blue trend-line) since June 20, using it as a pivot, a new pattern has emerged. That is a Head and Shoulders (H&S). That is so far contained within the Channel Up but a break below it can see the price testing the 1D MA200 (orange trend-line) for the first time since January 17. Our trading plan is based on the break-out (candle close) approach. A break below the lower tolerance level of the Channel constitutes a sell signal towards the -1.0 Fibonacci extension (1.075), in which case the H&S pattern prevails. Until that happens, we continue being within the dominant Channel Up, hence bullish towards a new long-term Higher High near the 2.0 Fibonacci extension (1.1383). -------------------------------------------------------------------------------------------------------- Please like, subscribe and share your ideas and charts with the community! --------------------------------------------------------------------------------------------------------
by TradingShot
AUD/NZD Outlook (28 June 2022)Movement of the AUDNZD cross tends to be affected by factors in the local economy rather than global headline and tends to have a strong trend following characteristic. Currently the AUDNZD is sitting just below the 1.1050 resistance level, having climbed up from the 1.0950 support level. The natural anticipation will be to expect the momentum to continue, for price to break the resistance, continuing the move upward. However, pay attention to the 16th through 19th May where price spiked & retraced, struggling to break high from that 1.1050 resistance level. Therefore, it would be better to stay neutral on the AUDNZD at this point, wait for a clear break higher or lower before entering into a trade.
by JinDao_Tai
4
AUDNZD Very strong long-term Channel UpThe AUDNZD pair has been trading within a Channel Up since the November 19 2021 Low. The price only broke outside this pattern twice but was limited to the -0.236 Fibonacci extension (March 15 2022) and the 0.236 Fibonacci extension (May 04 2022). The 1D MA50 (blue trend-line) has been holding as a Support since March 17. The price is now on the 4th straight red 1D candle following the Channel's recent Higher High and the level to buy is either at the bottom of the pattern (around the 1D MA50) or if the 1D RSI hits its Lower Lows trend-line first. Target: the top of the Channel Up. -------------------------------------------------------------------------------------------------------- ** Please support this idea with your likes and comments, it is the best way to keep it relevant and support me. ** --------------------------------------------------------------------------------------------------------
Long
by TradingShot