AUD/NZD has extended its rebound from...>

AUSSIE-KIWI: AUD/NZD has extended its rebound from a five-month low of NZ$1.0316

printed on Wednesday; at typing it trades at NZ$1.0385, 17 pips higher on the

day. A market source pointed to speculative accounts covering AUD/NZD shorts,

which pushed the pair a touch higher early on. A considerably stronger than

expected Australian retail sales reading resulted in a ~20 pip leg higher, which

was promptly faded. The short-lived nature of the reaction move may have stemmed

from the quick realisation that the Aussie data was affected by the Black Friday

bonanza. AUD/NZD demand re-emerged over the last 45 mins or so despite lack of

any notable drivers.

- The initial technical ceiling is formed by NZ$1.0400, a psychological level

that provided support through most of December. A jump onto the NZ$1.0400 handle

would expose the 23.6% retracement of the Nov 7 - Jan 8 sell-off at NZ$1.0446.

Bears look for a pullback through the Jan 1/Dec 18 lows of NZ$1.0370/67, which

would return the focus to Wednesday's five-month low of NZ$1.0316.