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AUD/NZD Fails to Break 1.0900, AU CPI & NZ Budget Shortly

NZD
  • AUD/NZD has pulled back after testing 1.0900 early on Tuesday. The pair tapped 1.0870 twice post the Asian session, before closing at 1.0882 where we currently trade ahead of AU CPI and NZ budgets shortly
  • The cross is now up 2.95% after testing yearly lows on Feb 22, while the AU-NZ 2Y swap is just off recent highs at -85bps
  • Key technical levels to watch: initial resistance is now 1.0900, a break here opens up 1.0925/35 (Sept 18/July 26 highs). While to the downside, initial support is 1.0780 (20-day EMA) a break below 1.0750 (50/100-day EMA) could signal further weakness, opening up 1.0700 (Mar 11 lows)
  • Upcoming expiries: US$202.3m put with a 1.0875 strike for March 27th NY cut.
  • Looking ahead: AU has Westpac Leading Index and CPI shortly, while NZ Government Budget Policy Statement is due out shortly.

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