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Crude Oil, NZDUSD, AUDUSD Analysis and Talking Points

  • NZDUSD: 0.6700 Break Opens up Key Fibo Support
  • AUDUSD: Rise Limited Thus Far with 0.7200 Resistance intact
  • Crude Oil: Geopolitical Risk Premium Keeps $65 Test Alive

See the DailyFX Q2 FX forecast to learn what will drive the currency throughout the quarter.

NZDUSD: 0.6700 Break Opens up Key Fibo Support

Following the recent New Zealand CPI data, the outlook for the Kiwi has gotten materially worse with odds for a rate cut at the May 8th meeting now at 50%. This in turn has placed pressure back on the 0.6700 handle, which has now opened up test of key support at 0.6690 (23.6% Fibonacci retracement of 2017 high to 2018 low). Consequently, a closing break below could see selling exacerbate with a move to 0.6620. In order for a bearish outlook to ease, a bounce from 0.6690 and subsequently break above 0.6730-35 (200DMA) would be needed. NZD weakness may be better express through AUDNZD.

NZDUSD Price Chart: Daily Time Frame (Oct 2018 – Apr 2019)

NZDUSD, AUDUSD, Crude Oil Technical Setups for Next Week

Chart by IG

AUDUSD: Rise Limited Thus Far with 0.7200 Resistance intact

Recent sessions have seen a bout of Aussie buying following the recent improvement in Chinese data, while the continued hopes that a trade deal between the US and China can be finalised in the near future also provide underlying support, despite the domestic challenges in Australia. Overnight, the Australian jobs report was relatively robust and thus keeping the Aussie elevated. However, resistance stemming from the 200DMA at 0.7190 and psychological 0.7200 handle remain firm, preventing further upside in AUDUSD thus far. Next week will see a flurry of key data points from Australia (CPI report), which will be pivotal on whether 0.7200 resistance breaks down. If even indeed a firm breach is made, topside targets are situated at 0.7250-70. On the downside, key support is situated at 0.7130.

AUDUSD Price Chart: Daily Time Frame (Aug 2018 – Apr 2019)

NZDUSD, AUDUSD, Crude Oil Technical Setups for Next Week

Chart by IG

Crude Oil: Geopolitical Risk Premium Keeps $65 Test Alive

Sentiment in the oil complex was relatively soft on Wednesday with WTI failing yet again to break $65/bbl. While yesterday’s DoE crude inventory report showed a surprise drawdown, this was however less than the API report and thus oil prices pullback. With that said, geopolitical risks continue to keep oil prices elevated with the US once again stepping up its pressure on Venezuela, while we also move closer to the Iranian oil waiver expiration date. Despite WTI crude struggling to reach $65, support stemming from the 61.8% Fibonacci retracement provides technical support. As equity markets continue its grind higher to record highs, a $65 breach could see a move towards $68.70.

Crude Oil Price Char: Daily Time Frame (Aug 2018Apr 2019)

NZDUSD, AUDUSD, Crude Oil Technical Setups for Next Week

Chart by IG

FX Charts to Watch: USDCAD, CADJPY

RECOMMENDED READING

Guide to using key economic events to trade FX

--- Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX