Retreats Onto 50-DMA

Participants moved on after dovish RBNZ comments that aroused some interest yesterday and AUD/NZD has turned its tail. The pair has shed 26 pips thus far, pulling back onto its 50-DMA, and last trades at NZ$1.0869. BBG trader sources attributed the move to NZD purchases against AUD by leverage funds. The rate is poised to chart a bearish Harami candlestick pattern in Asia and holding this formation into the close would send a clean bearish signal.

• A clean break below the 50-DMA at NZ$1.0868 would turn bearish focus to Oct 6 low of NZ$1.0760, followed by Sep 25 low of NZ$1.0718. On the flip side, a push through Oct 8 high/round figure of NZ$1.0898/1.0900 would give bulls a green light for targeting Sep 10 high of NZ$1.0936.
• Nothing left on the Antipodean calendars this week, which shifts focus to broader market and headline flow.