AUD/NZD Fails to Close Above 1.09- GBP/NZD Risks Fresh Highs on RBNZ

David Song
April 23, 2014

Talking Points:

- USDOLLAR Continues to Search for Lower High; Watching for Close Above 10,470

- AUD/NZD Fails to Close Above 1.0900; Hawkish RBNZ to Prompt Further Declines

- GBP/AUD Breaks Out of Bearish RSI Momentum; Higher High on Tap?

Index

Last

High

Low

Daily Change (%)

Daily Range (% of ATR)

DJ-FXCM Dollar Index

10471.57

10478.16

10449.81

0.18

93.73%

The Dow Jones-FXCM U.S. Dollar Index (Ticker: USDollar) poked above the 10,470 pivot as Australia’s Consumer Price report dragged on the AUD/USD, but we will continue to look for opportunities to ‘sell bounces’ in the greenback as price & the Relative Strength Index (RSI) retain the bearish structure from earlier this year.

AUD/NZD Fails to Close Above 1.09- GBP/NZD Risks Fresh Highs on RBNZ
AUD/NZD Fails to Close Above 1.09- GBP/NZD Risks Fresh Highs on RBNZ

Indeed, a failed attempt to close above 10,470 may highlight a topping process as market participants turn their attention to the Federal Open Market Committee (FOMC) interest rate decision on April 30, and the bearish sentiment surrounding the reserve currency may gather pace over the near-term as Chair Janet Yellen remains in no rush to normalize monetary policy.

With that said, the USDOLLAR remains at risk of giving back the advance from back in October (10,354), and the ongoing weakness in the greenback may persist throughout the first-half of 2014 as the bar remains high in seeing a material shift to the Fed’s policy outlook.

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Read More:

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EUR/AUD, EUR/USD Reverse Data Slump; GBP/USD Bull Flag or Double Top

USDOLLAR Daily

AUD/NZD Fails to Close Above 1.09- GBP/NZD Risks Fresh Highs on RBNZ
AUD/NZD Fails to Close Above 1.09- GBP/NZD Risks Fresh Highs on RBNZ

Chart - Created Using FXCM Marketscope 2.0

  • Need Close Above 10,470 for Larger Correction; Still Searching for Lower High
  • Interim Resistance: 10,602 (38.2 retracement) to 10,615 (78.6 expansion)
  • Interim Support: 10,406 (1.618 expansion)

Release

GMT

Expected

Actual

Markit Purchasing Manager Index Manufacturing (APR P)

13:45

56.0

55.4

New Home Sales (MAR)

14:00

450K

New Home Sales (MoM) (MAR)

14:00

2.3%

DOE U.S. Crude Oil Inventories (APR 18)

14:30

DOE U.S. Distillate Inventory (APR 18)

14:30

DOE U.S. Gasoline Inventories (APR 18)

14:30

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--- Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

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