AUD/NZD trades a touch lower at its.....>

AUSSIE-KIWI: AUD/NZD trades a touch lower at its 50-DMA of NZ$1.0480. This comes

after yesterday's surge on the back of a surprisingly dovish RBNZ. The Bank

trimmed its ORC by 50bps vs. exp. of a 25bps cut, while during the subsequent

presser Gov Orr refused to rule out further easing & mentioned looking into

various policy options, including unconventional tools. This set the tone for

the rest of the day and AUD/NZD continued to fluctuate at elevated levels.

- Orr reiterated the possibility of using negative rates today & accused some

banks of scaring the public over the proposed capital plan. His RBNZ colleague

Hawkesby said that members now look for an increase in inflation expectations.

- NZ$1.0500 has refused to give way so far, with the rate topping out just shy

of the round figure both yesterday and today. The fact that it is located just

above the YtD mid-point ($1.0498) adds importance to the level. A clean break

above would allow bulls to set their sights on the 100-DMA/200-DMA at

NZ$1.0520/21. Bears look for a fall below trendline resistance-turned-support,

which kicks in at NZ$1.0476, and seemingly limits the rate to the downside.

Below would expose the 38.2% retracement of the YtD range at NZ$1.0443.