AUD/USD, NZD/USD, USD/CNY – Little Movement After RBA Decision, NZ Employment DataThere was limited movement in the Asian session. The Australian dollar yawned after the RBA held rates. The New Zealand dollar and Chinese yuans are showing slight gains.
AUD/USD is flat on Wednesday, continuing the lack of activity which marked Tuesday trade. In the European session, the pair is trading at 0.6890, up 0.01% on the day.
RBA Holds the Course
As expected, the Reserve Bank of Australia maintained rates at 0.75%, after trimming rates in the previous meeting. The Aussie held steady, despite a dovish rate statement, which said that “risks are tilted to the downside” and noted its concern with the ongoing U.S.-China tariff spat.
AUD/USD Technical Analysis
AUD/USD remains range-bound. The pair has tested resistance at 0.6920 this week, but is clearly having difficulty breaking above this line. Above, we find resistance at 0.6960. Below, we find immediate support at 0.6880. This line was tested on Tuesday and remains vulnerable.
USD/CNY continues to lose ground, as the Chinese yuan has posted slow-but-steady gains since last week. In Wednesday’s European session, the pair is trading at 6.9979, down 0.16% on the day. There are no Chinese releases until Friday.
USD/CNY Technical Analysis
USD/CNY has extended the current downtrend and is currently trading at the round number of 7.000. I expect the pair to break out and push below this line during the week, which would be a dramatic development. USD/CNY has room to move lower, with no support levels until 6.9930. On the upside, there is resistance at 7.0400. Above, the 50-EMA, which is at 7.0670, continues in a resistance role.
NZD/USD has posted small losses in Wednesday trade. In the European session, the pair is trading at 0.6364, down 0.12% on the day.
New Zealand Job Data Within Expectations
There were no surprises from New Zealand’s employment numbers for the third quarter. The numbers were weaker in the Q3, as the U.S.-China trade war and weaker global demand continue to weigh on the New Zealand economy. Employment change posted a weak gain 0.2%, after a strong release of 0.8% in Q2. Still, this matched the forecast. The unemployment rate climbed to 4.2%, up from 3.9%. This was a shade above the estimate of 4.1%.
NZD/USD Technical Analysis
NZD/USD has lost ground for a third successive day, as the pair appears to be in a downtrend. There is strong pressure on support at 0.6360, and I expect this line to be tested before the end of the week. I continue to monitor the 50-EMA, which is at 0.6370, very close to the pair. If the pair breaks above this line, it could be a sign of a trend reversal. In the meantime, the situation remains fluid, so I would counsel patience until we have a better idea of which direction NZD/USD is headed. On the upside, there is resistance at 0.6490, protecting the symbolic round number of 0.6500.