AUD/USD and NZD/USD Fundamental Analysis: China PMI to Move the Dial

It is a busy morning for the AUD/USD and NZD/USD. This morning, New Zealand building consents drew interest ahead of Australian trade data for March.

Building consents surged by 7.0% in March, versus a forecasted 0.3% decline. In February, building consents fell by 0.4%. However, the numbers had no impact on the Kiwi.

While the Australian trade data will draw more interest, the China Caixin Manufacturing PMI will likely have more impact on the pairings. Last Sunday, the China NBS Manufacturing PMI fell from 51.9 to 49.2, signaling a waning post-COVID-19 economic recovery.

We expect more market sensitivity to the Caixin figure. Economists forecast the PMI to increase from 50.0 to 50.3.

Looking ahead to the US session, initial jobless claims, unit labor costs, nonfarm productivity, and trade data will also move the dial.

AUD/USD Price Action

This morning, the AUD/USD was down 0.40% to 0.66435. A mixed start to the day saw the AUD/USD rise to an early high of $0.66729 before falling to a low of $0.66407. The AUD/USD fell through the First Major Support Level (S1) at $0.6645.

Technical Indicators

Resistance & Support Levels

The AUD/USD needs to move through S1 and the $0.6674 pivot to target the First Major Resistance Level (R1) at $0.6699 and the Wednesday high of $0.67033. A return to $0.6690 would signal a bullish session. However, the Aussie would need the numbers from China and Australia to support a pre-US session breakout.

In case of a breakout session, the Aussie would likely test the Second Major Resistance Level (R2) at $0.6728. The Third Major Resistance Level (R3) sits at $0.6782.

Failure to move through S1 and the pivot would leave the Second Major Support Level (S2) at $0.6620 in play. However, barring a data-fueled sell-off, the AUD/USD pair should avoid sub-$0.66. The Second Major Support Level (S2) at $0.6620 should limit the downside.

The Third Major Support Level (S3) sits at $0.6566.

Looking at the EMAs and the 4-hourly chart, the EMAs sent bearish signals. The AUD/USD sits below the 50-day EMA, currently at $0.66560. The 50-day EMA fell back from the 100-day EMA, with the 100-day EMA easing back from the 200-day EMA, delivering bearish signals.

A move through S1 ($0.6645) and the 50-day ($0.66560) and 100-day ($0.66681) EMAs would give the bulls a run at the 200-day EMA ($0.66889) and R1 ($0.6699). However, failure to move through S1 ($0.6645) and the 50-day EMA ($0.66889) would bring S2 ($0.6620) into view. A move through the 50-day EMA would be a bullish signal.

NZD/USD Price Action

This morning, the NZD/USD was down 0.25% to $0.62123. A mixed start to the day saw the NZD/USD rise to an early high of $0.62298 before falling to a low of $0.62069.

Technical Indicators

Resistance & Support Levels

The NZD/USD has to move through the $0.6231 pivot to target the First Major Resistance Level (R1) at $0.6257 and the Wednesday high of $0.62606. A move through the morning high of $0.62298 would signal a bullish session. However, the China manufacturing PMI must support a pre-US session breakout.

In the case of a breakout session, the Kiwi would likely test the Second Major Resistance Level (R2) at $0.6287. The Third Major Resistance Level (R3) sits at $0.6343.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.6201 in play. However, barring a Fed-fueled sell-off, the NZD/USD should steer clear of sub-$0.6150. The Second Major Support Level (S2) at $0.6175 should limit the downside.

The Third Major Support Level (S3) sits at $0.6119.

Looking at the EMAs and the 4-hourly chart, the EMAs sent bullish signals. The NZD/USD sits above the 200-day EMA, currently at $0.62057. The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A hold above the 200-day EMA ($0.62057) would support a breakout from R1 ($0.6257) to target R2 ($0.6287). However, a fall through the 200-day ($0.62057) and S1 ($0.6201) would bring the 100-day ($0.61897) and 50-day ($0.61849) EMAs and S2 ($0.6175) into play. A fall through the 50-day EMA would send a bearish signal.