Source: PaxForex Premium Analytics Portal, Fundamental Insight
The New Zealand Business PMI for June came in at 47.5. Economists predicted a reading of 49.8. Forex traders can compare this to the New Zealand Business PMI for May, reported at 48.9.
New Zealand Electronic Retail Card Spending for June rose by 1.0% monthly and 4.2% annualized. Economists predicted a decrease of 0.2% and an increase of 9.9%. Forex traders can compare this to New Zealand Electronic Retail Card Spending for May, which dropped by 1.7% monthly and expanded by 3.3% annualized.
New Zealand Food Prices for June increased by 1.8% monthly and surged by 12.5% annualized. Forex traders can compare this to New Zealand Food Prices for May, which rose by 0.3% monthly and accelerated by 12.1% annualized.
Australian Consumer Inflation Expectations for July increased by 5.2% annualized. Economists predicted a rise of 5.1%. Forex traders can compare this to Australian Consumer Inflation Expectations for June, which expanded by 5.2% annualized.
The Chinese Trade Balance for June came in at $70.62B. Economists predicted a figure of $74.80B. Forex traders can compare this to the Chinese Trade Balance for May, reported at $65.81B. Exports for June plunged by 12.4% annualized and Imports by 6.8% annualized. Economists predicted a drop of 9.5% and 4.0%. Forex traders can compare this to Exports for May, which contracted by 7.5% annualized, and Imports by 4.5% annualized.
After the Reserve Bank of New Zealand held interest rates unchanged at 5.50%, the New Zealand Dollar lost its bullish catalyst. Given the size and diversification of the Australian economy versus New Zealand, the AUD/NZD can regain lost ground over the next few weeks to challenge its 2023 peak above 1.1055.
The forecast for the AUD/NZD is moderately bullish after this currency pair corrected into its upward-shifting Ichimoku Kinko Hyo Cloud. The Senkou Span B is flat, but the Senkou Span A continues to drift moderately higher. Volatility could rise with the Kijun-sen flat as the Tenkan-sen resumes its downtrend following a bearish crossover. Traders should monitor the CCI after a positive divergence has formed in extreme oversold territory followed by a breakout. This technical indicator may test the -100 level once again before moving higher. A sustained breakout above zero may accelerate price action higher. Can bulls withstand bearish attacks and push the AUD/NZD toward its horizontal resistance 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 breakout above the 1.0730 to 1.0790 zone, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.0755
- Take Profit Zone: 1.0920 – 1.0975
- Stop Loss Level: 1.0695
Should price action for the AUD/NZD breakdown below 1.0730, PaxForex recommends the following trade set-up:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 1.0695
- Take Profit Zone: 1.0575 – 1.0620
- Stop Loss Level: 1.0730
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