AUD/USD and NZD/USD Fundamental Analysis: Services PMIs in Focus
It is a relatively busy Monday session for the AUD/USD and NZD/USD. Company gross profit numbers will provide the Aussie with direction.
However, economic indicators from China will influence both pairings. The Caixin Services and Composite PMI numbers will draw interest. Weaker-than-forecasted PMI numbers would weigh on the Aussie and the Kiwi. Economists forecast the Services PMI to fall from 56.4 to 55.0.
Looking ahead to the US session, the ISM Non-Manufacturing PMI will be the main report of the day. While the headline PMI figure will influence, investors should consider the sub-components, including employment, prices, and new orders Indexes.
AUD/USD Price Action
This morning, the AUD/USD was down 0.07% to $0.66005. A mixed start to the day saw the AUD/USD fall to an early low of $0.65983 before rising to a high of $0.66056.
Technical Indicators
Resistance & Support Levels
| R1 – $ | 0.6640 | S1 – $ | 0.6567 |
| R2 – $ | 0.6676 | S2 – $ | 0.6530 |
| R3 – $ | 0.6749 | S3 – $ | 0.6456 |
The AUD/USD needs to move through the $0.6603 pivot to target the First Major Resistance Level (R1) at $0.6640. A move through the Friday high of $0.66385 would signal a bullish session. However, economic indicators must support a breakout.
In case of a breakout session, the Aussie would likely test the Second Major Resistance Level (R2) at $0.6676. The Third Major Resistance Level (R3) sits at $0.6749.
Failure to move through the pivot would leave the First Major Support Level (S1) at $0.6567 in play. However, barring a risk-off-fueled sell-off, the AUD/USD pair should avoid sub-$0.65 and the Second Major Support Level (S2) at $0.6530.
The Third Major Support Level (S3) sits at $0.6456.
Looking at the EMAs and the 4-hourly chart, the EMAs sent bullish signals. The AUD/USD sits below the 200-day EMA, currently at $0.66298. The 50-day EMA narrowed to the 100-day EMA, with the 100-day EMA closing in on the 200-day EMA, delivering bullish signals.
An AUD/USD move through the 200-day EMA ($0.66298) and R1 ($0.6640) would give the bulls a run at R2 ($0.6676). However, a fall through the 100-day EMA ($0.65915) would bring S1 ($0.6567) and the 50-day EMA ($0.65628) 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 0.02% to $0.60572. A mixed start to the day saw the NZD/USD fall to an early low of $0.60505 before rising to a high of $0.60586.
Technical Indicators
Resistance & Support Levels
| R1 – $ | 0.6094 | S1 – $ | 0.6035 |
| R2 – $ | 0.6132 | S2 – $ | 0.6015 |
| R3 – $ | 0.6190 | S3 – $ | 0.5956 |
The NZD/USD has to move through the $0.6073 pivot to target the First Major Resistance Level (R1) at $0.6094 and the Friday high of $0.61112. A return to $0.6075 would signal a bullish session. However, the China PMI numbers must support a pre-US session breakout.
In the case of a breakout session, the Kiwi would likely test resistance at the Second Major Resistance Level (R2) at $0.6132. The Third Major Resistance Level (R3) sits at $0.6190.
Failure to move through the pivot would leave the First Major Support Level (S1) at $0.6035 in 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 $0.6015 should limit the downside.
The Third Major Support Level (S3) sits at $0.5956.
Looking at the EMAs and the 4-hourly chart, the EMAs were bearish. The NZD/USD sits below the 50-day EMA, currently at $0.60835. 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 move through the 50-day EMA ($0.60835) and R1 ($0.6094) would give the bulls a run at the 100-day EMA ($0.61317) and R2 ($0.6132). However, failure to move through the 50-day EMA ($0.60835) would leave S1 ($0.6035) in view. A move through the 50-day EMA would send a bullish signal.
