News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • RT @carlquintanilla: B of A: “The virus situation is improving rapidly and this has helped spur a pick-up in activity. .. Air travel contin…
  • $USD still holding support in the 93.43-93.73 zone shorter-term, not yet able to pose any meaningful continuation moves, still lower-lows, highs next r level, 94.17 next s level, 93.52 #DXY https://t.co/d5DtqK4xUc https://t.co/ZRCho2lSOi
  • 🇨🇦 Core Inflation Rate YoY (SEP) Actual: 3.7% Previous: 3.5% https://www.dailyfx.com/economic-calendar#2021-10-20
  • 🇨🇦 Inflation Rate MoM (SEP) Actual: 0.2% Expected: 0.1% Previous: 0.2% https://www.dailyfx.com/economic-calendar#2021-10-20
  • 🇨🇦 Inflation Rate YoY (SEP) Actual: 4.4% Expected: 4.3% Previous: 4.1% https://www.dailyfx.com/economic-calendar#2021-10-20
  • Join @CVecchioFX at 9:30 EST/13:30 GMT for your mid-week market update webinar. Register here: https://t.co/daghpCQ68Y https://t.co/uYC56N17Cq
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 91.80%, while traders in GBP/JPY are at opposite extremes with 74.91%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/rMdHguFejf
  • finally getting some pullback in these Yen trends $AUDJPY tagged the 85.81 level, support potential around 85 prior resistance, then another around 84.25. let's see what this Yen theme is made of https://t.co/QVf7SHffCW https://t.co/RZzrs86xp6
  • Forex Update: As of 12:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.20% 🇨🇦CAD: 0.17% 🇦🇺AUD: 0.16% 🇪🇺EUR: -0.08% 🇨🇭CHF: -0.10% 🇬🇧GBP: -0.28% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/cNnkSEOOMU
  • Heads Up:🇨🇦 Inflation Rate MoM (SEP) due at 12:30 GMT (15min) Expected: 0.1% Previous: 0.2% https://www.dailyfx.com/economic-calendar#2021-10-20
AUD/NZD Bounces but Incoming Death Cross May Keep Outlook Bearish

AUD/NZD Bounces but Incoming Death Cross May Keep Outlook Bearish

Thomas Westwater, Analyst

AUD/NZD, Sentiment, Covid – Talking Points:

  • AUD/NZD lifts, but incoming bearish signal could further plague cross
  • The S&P 500 closed at record high for second consecutive day
  • China Caixin Composite PMI may drive sentiment in APAC trading
Advertisement

U.S. equity markets continued to march higher in Wednesday’s New York trading session, with the S&P 500 hitting a record high for the second consecutive day. Tuesday’s gain is mainly attributed to advances in health care and financial stocks. Still, momentum appeared to slow, and the tech-heavy Nasdaq-100 index eked out a gain of only 0.01%. Gold extended gains after a healthy bounce earlier this week.

The slowdown in momentum may pass by as nothing more than a pause before another push higher in the U.S. equity space, but notable risks remain present. Today, the Federal Reserve’s Beige Book highlighted some of those risks. One point of concern is a softening in sentiment around the labor markets. While hiring growth has been steady, firms expressed concern over new lockdowns in the coming months as Covid cases rise sharply in parts of the United States.

Those concerns echoed this morning’s U.S. ADP jobs report that showed a net addition of 307k jobs according to the DailyFX Economic Calendar. The figure was a significant miss compared to economists’ expectations for 404k jobs. Traders will key in on tomorrow’s initial jobless claims and ISM services PMI to gauge the strength of the economy.

S&P 500, AUD/NZD, Gold – Daily Price Chart

AUDNZD, Gold, SP500

Chart created with TradingView

Thursday’s Asia-Pacific Outlook:

Trading in the Asia-Pacific session may not receive a spillover of sentiment from the U.S. one given the modest moves. Trading may depend on upcoming economic data prints as investors look to evaluate the stance of the global economy. One headline that will warrant particular attention is China’s Caixin PMI figures. Economic strength in China has been a primary driver of sentiment in recent months.

However, a recent headwind for China appeared today out of the United States Congress. The House of Congress passed a bill aimed at delisting Chinese companies that trade on U.S. exchanges. Ultimately, if the bill becomes law, Chinese companies will have three years to comply with additional auditing standards. So, the lack of a reaction in markets is unsurprising. Still, the move signals yet another escalation in the fragile relationship between China and the United States. That said, keeping an eye on the bill’s development would be wise.

AUD/NZD Technical Outlook:

Looking at two currencies with high exposure to not only sentiment, but regional headline risks in the Asia-Pacific region shows a bearish outlook in AUD/NZD. The cross is down just over 5% from its 2020 August swing high. The Australian Dollar rallied against the Kiwi, but technical pressure look to remain.

In fact, if the recent pace holds, AUD/NZD will form a Death Cross in the coming days with its 50-day moving average closing in on the 200-day one. The long-term bullish pattern could give a bad omen and likely put a bad taste in AUD/NZD bulls’ mouths.

AUD/NZD Daily Chart

AUD/NZD Chart

Chart created with TradingView

AUD/NZD TRADING RESOURCES

--- Written by Thomas Westwater, Analyst for DailyFX.com

To contact Thomas, use the comments section below or @FxWestwateron Twitter

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES