Source: PaxForex Premium Analytics Portal, Fundamental Insight
The Australian AiG Performance of Manufacturing Index for December was reported at 48.4. Forex traders can compare this to the Australian AiG Performance of Manufacturing Index for November, reported at 54.8. The Final Australian Markit Manufacturing PMI for January was reported at 55.1. Forex traders can compare this to the Australian Markit Manufacturing PMI for December, reported at 57.7.
Australian Home Loans for December increased 5.3% monthly, and Investment Lending for Homes increased 2.4% monthly. Forex traders can compare this to Australian Home Loans for November, which increased 7.6% monthly, and Investment Lending for Homes, which increased 3.8% monthly. Australian Retail Sales for December decreased 4.4% monthly. Economists predicted an increase of 3.9% monthly. Forex traders can compare this to Australian Retail Sales for November, which increased 7.3% monthly.
The Australian RBA left interest rates unchanged at 0.10%. Economists predicted no change in interest rates. Forex traders can compare this to the previous Australian RBA Interest Rate Decision, where interest rates were unchanged at 0.10%. The Australian RBA Commodity Index for January increased by 25.3% annualized. Forex traders can compare this to the Australian RBA Commodity Index for December, which increased 28.7% annualized.
The New Zealand Trade Balance for December was reported at -NZ$477M monthly and at -NZ$6,780M annualized. Forex traders can compare this to the New Zealand Trade Balance for November, reported at -NZ$1,060M monthly and -NZ$6,230M annualized. Exports for December were reported at NZ$6.07B and Imports at NZ$6.55B. Forex traders can compare this to Exports for November, reported at NZ$5.69B, and Imports, reported at NZ$6.75B.
The forecast for the AUD/NZD turned bearish after price action stalled at resistance. This currency pair is now vulnerable to a sell-off, but volatility is likely to increase as bulls and bears fight for control. The Tenkan-sen and the Kijun-sen move higher, but the latest D1 candlestick is forming a bearish pattern. While the Ichimoku Kinko Hyo Cloud maintains a bullish stance, any sell-off may remain limited to the Senkou Span B, which marks the bottom of the cloud. Traders should also monitor the CCI, which started to retreat from its peak inside extreme overbought territory. A breakdown below 100 could trigger the expected sell-off. Can bears force the AUD/NZD into a correction until price action reaches its horizontal support area? Subscribe to the PaxForex Daily Fundamental Analysis and earn over 5,000 pips per month.
Should price action for the AUD/NZD remain inside the or breakdown below the 1.0700 to 1.0755 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.0720
- Take Profit Zone: 1.0480 – 1.0520
- Stop Loss Level: 1.0775
Should price action for the AUD/NZD breakout above 1.0755, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.0775
- Take Profit Zone: 1.0825– 1.0845
- Stop Loss Level: 1.0755
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