AUD/USD and NZD/USD Fundamental Analysis: Aussie GDP in Focus

It is a busy Wednesday session for the AUD/USD and NZD/USD. The Aussie dollar will be in the spotlight early in the session. The AIG Manufacturing Index drew interest ahead of Q1 GDP numbers following the RBA’s surprise 25-basis point interest rate hike.

Economists forecast the Australian economy to expand by 0.8% in Q1. In Q4, the economy grew by 0.5%.

While the GDP numbers will be the key drivers, the RBA will also move the dial. RBA Governor Philip Lowe and Assistant Governor Bullock are on the calendar to speak ahead of the GDP numbers. The RBA will also release its chart pack.

However, later in the morning, China trade data will need consideration. We expect the import and export numbers to influence both pairings.

Looking toward the US session, it is another quiet session. US trade data will be out early in the session. However, barring a marked widening in the trade deficit, the numbers should have a limited impact on the AUD/USD and NZD/USD pairings.

AUD/USD Price Action

This morning, the AUD/USD was up 0.05% to $0.66740. A mixed start to the day saw the AUD/USD fall to an early low of $0.66630 before rising to a high of $0.66755.

Technical Indicators

Resistance & Support Levels

The AUD/USD needs to avoid the $0.6655 pivot to target the First Major Resistance Level (R1) at $0.6701. A move through the Tuesday high of $0.66855 would signal a bullish session. However, the RBA and economic indicators must support a breakout.

In case of a breakout session, the Aussie would likely test the Second Major Resistance Level (R2) at $0.6731. The Third Major Resistance Level (R3) sits at $0.6807.

A fall through the pivot would bring the First Major Support Level (S1) at $0.6625 into play. However, barring a risk-off-fueled sell-off, the AUD/USD pair should avoid sub-$0.66 and the Second Major Support Level (S2) at $0.6579.

The Third Major Support Level (S3) sits at $0.6503.

Looking at the EMAs and the 4-hourly chart, the EMAs sent bullish signals. The AUD/USD sat above the 200-day EMA, currently at $0.66307. The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing on the 200-day EMA, delivering bullish signals.

An AUD/USD hold above the 200-day EMA ($0.66307) would give the bulls a run at R1 ($0.6701). However, a fall through the 200-day EMA ($0.66307) would bring S1 ($0.6625) and the 100-day ($0.66015) and 50-day ($0.65924) EMAs into view. An AUD/USD fall through the 50-day EMA would send a bearish signal.

NZD/USD Price Action

This morning, the NZD/USD was up 0.04% to $0.60799. A mixed start to the day saw the NZD/USD fall to an early low of $0.60728 before rising to a high of $0.60809.

Technical Indicators

Resistance & Support Levels

The NZD/USD has to avoid the $0.6074 pivot to target the First Major Resistance Level (R1) at $0.6103. A return to $0.61 would signal a bullish session. However, the Kiwi would need economic data from China to support a breakout.

In the case of a breakout session, the Kiwi would likely test resistance at the Second Major Resistance Level (R2) at $0.6129. The Third Major Resistance Level (R3) sits at $0.6184.

A fall through the pivot would bring the First Major Support Level (S1) at $0.6049 into play. However, barring a risk-off-fueled sell-off, the NZD/USD should steer clear of sub-$0.60. The Second Major Support Level (S2) at $0.6020 should limit the downside.

The Third Major Support Level (S3) sits at $0.5965.

Looking at the EMAs and the 4-hourly chart, the EMAs were bearish. The NZD/USD sat at the 50-day EMA, currently at $0.60790. The 50-day EMA eased back from the 100-day EMA, with the 100-day EMA pulling back from the 200-day EMA, delivering bearish signals.

An NZD/USD breakout from the 50-day EMA ($0.60790) would give the bulls a run at R1 ($0.6103) and the 100-day EMA ($0.61188). However, a fall through the 50-day EMA ($0.60790) would bring S1 ($0.6049) into view. A breakout from the 50-day EMA would send a bullish signal.