FxWirePro: AUD/NZD Opens Gap down by 62 Pips But Recovers Quickly Above 1.0400 Mark, Australia's Political Uncertainty
- AUD/NZD is trading around 1.0437 marks.
- Pair made intraday high at 1.0443 and low at 1.0363 marks.
- Short term bias remains neutral till the time pair holds key support at 1.0416 marks.
- On the top side, a sustained close above 1.0547 will drag the parity higher towards 1.0647/1.0748/1.0823/1.0976 (January 2016 high) /1.1062 (30D EMA)/1.1123/1.1298/1.1317 levels respectively.
- Alternatively, current downfall will take the parity down towards key supports around 1.0408 (June 9, 2016 low), 1.0362 and 1.0231 marks respectively.
- Important to note here that, 20D, 30D and 55D EMA heads down and confirms bearish trend in a daily chart.
- Australia June MI inflation gauge increase to 0.6 % vs previous -0.2 %.
- Australia May building approvals decrease to -5.2 % (forecast -3.3 %) vs previous 3%.
- Australia May private house approvals increase to 0.1 % vs previous -2.3 %.
- Australia’s economy is influenced by current political uncertainty. Neither the Labor party nor the coalition gained enough seats in the weekend's election to form a majority government.
- On the other side, RBA will hold its board meeting on July 5, 2016 Tuesday and almost all 37 economists polled by Reuters last week expect it to keep the cash rate unchanged at a record low 1.75 percent.
Positioning is inconclusive at this point, with prices offering no clear cut signal to initiate a long or short trade. We will continue to remain on sidelines for the time being.