AUD/USD and NZD/USD Fundamental Analysis: RBA and Trade in Focus

It is a busy morning for the AUD/USD, with trade data for February and the RBA Financial Stability Review in focus.

Following the RBA decision to hold interest rates on Tuesday, the Financial Stability Review will give investors a further sense of the RBA’s view on household credit conditions.

A gloomy assessment would weigh on the Aussie. However, trade data will also move the dial. Economists forecast the Australian trade surplus to narrow from A$11.688 billion to A$11.100 billion.

For the AUD/USD and NZD/USD, Caixin services PMI numbers for March will provide direction. After the disappointing Caixin manufacturing PMI figures, investors will look for the services sector to take up the slack. Economists forecast the services PMI to fall from 55.0 to 53.8.

In March, the Caixin Manufacturing PMI fell from 51.6 to 50.0, weighed by weak export demand.

Later today, US economic indicators will also influence, with the weekly jobless claims in focus. After disappointing JOLTs job openings from Tuesday, another increase in jobless claims would raise more red flags.

AUD/USD Price Action

The Aussie was up 0.10% to $0.67244. A mixed start to the day saw the AUD/USD fall to an early low of $0.67150 before rising to a high of $0.67253.

Technical Indicators

The AUD/USD needs to move through the $0.6725 pivot to target the First Major Resistance Level (R1) at $0.6773 and the Wednesday high of $0.67798. A return to $0.6750 would signal a bullish session. However, the Aussie Dollar would need the RBA and trade data to support a pre-US session breakout day.

In the case of another breakout session, the Aussie would likely test resistance at $0.68 but fall short of the Second Major Resistance Level (R2) at $0.6828. The Third Major Resistance Level (R3) sits at $0.6931.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.6670 in play. However, barring an RBA-fueled sell-off, the AUD/USD pair should avoid sub-$0.6650 and the Second Major Support Level (S2) at $0.6622.

The Third Major Support Level (S3) sits at $0.6519.

Looking at the EMAs and the 4-hourly chart, the EMAs send bullish signals. The AUD/USD sits above the 50-day EMA, currently at $0.67107. The 50-day EMA closed in on the 200-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A move through the 200-day EMA ($0.67303) would support a breakout from R1 ($0.6773) to target $0.68. However, a fall through the 50-day (0.67107) and 100-day (0.67045) EMAs would bring S1 ($0.6670) into play. A fall through the 50-day EMA would send a bearish signal.

NZD/USD Price Action

This morning, the Kiwi was up 0.08% to $0.63222. A mixed start to the day saw the NZD/USD fall to an early low of $0.63119 before rising to a high of $0.63244.

Technical Indicators

The NZD/USD needs to move through the $0.6327 pivot to target the First Major Resistance Level (R1) at $0.6369 and the Wednesday high of $0.6379. A return to $0.6350 would signal a bullish session. However, economic indicators from China need to impress to support a breakout.

In the case of another breakout session, the Kiwi would likely test resistance at $0.64 but fall short of the Second Major Resistance Level (R2) at $0.6421. The Third Major Resistance Level (R3) sits at $0.6515.

Failure to move through the pivot would leave the First Major Support Level (S1) at $0.6275 in play. However, barring a risk-off-fueled sell-off, the NZD/USD pair would likely avoid sub-$0.6250 and the Second Major Support Level (S2) at $0.6233.

The Third Major Support Level (S3) sits at $0.6139.

Looking at the EMAs and the 4-hourly chart, the EMAs send bullish signals. The NZD/USD sits above the 50-day EMA, currently at $0.62687. The 50-day pulled away from the 100-day EMA, with the 100-day EMA crossing through the 200-day EMA, delivering bullish signals.

A hold above S1 ($0.6275) and the 50-day EMA ($0.62687) would support a breakout from R1 ($0.6369) to target $0.64. However, a fall through S1 ($0.6275) and the 50-day EMA ($0.63687) would bring the 100-day ($0.62478) and 200-day ($0.62467) EMAs into view. A fall through the 50-day EMA would send a bearish signal.