Tomorrow will see the release of a regular business conditions and business confidence survey by National Australia Bank, followed up by a similar one from Westpac Bank on Wednesday. That same day, the New Zealand PMI for April will be released as well as NZ’s Food Price Index for March.
Thursday (effectively the last day of the trading week, with Easter ahead) is a far more “news” oriented day for the Australasians, with Australia releasing reports for consumer inflation expectations, financial stability review, employment changes (for March) and job participation rates.
Management and risk description
From a classical charting standpoint, AUDNZD displays a completed eight-month Inverse Head & Shoulders formation. Since reaching a peak of 1.1020 in mid-March, the AUDNZD cross has been pulling back (hard) and on Friday retested key Neckline support (refer daily chart below).
While this Neckline support holds, there is potential for AUDNZD to resume its recovery and rally toward 1.0900/1.0930 resistance, then retest last month’s 1.1020 high (en route to a pattern target of 1.1300 over the coming weeks) and presenting an excellent risk/reward.
Entry: today AUDNZD is seen as a buy about the 1.0790 level.
Stop: just under 1.0760, initially.
Target: 50% at 1.0893 and 50% at 1.1288.
Time horizon: allow several weeks for both targets to be met.
AUDNZD daily chart (click to expand)
AUDNZD weekly chart (click to expand)
Source: ThomsonReuters. Create your own charts with SaxoTrader; click here to learn more
– Edited by Gayle Bryant
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