EUR

The Australian Dollar (AUD) surged to reach 0.6130 (1.6320) in late Friday trading against the Australian Dollar (AUD) prior to falling back to 0.6090 (1.6420) at the close of the week. Monday’s action saw more EUR dominance, price pulling back towards 0.6060 (1.6500). The long-term bull channel from 0.5865 (1.7050) mid-August dominates the chart with resistance in the move seen at 0.6155 (1.6250) from here. RBA later today with the central bank not expected to hike from 4.10% for now.

Current Level: 0.6073
Resistance: 0.6150
Support: 0.5880
Last Weeks Range: 0.6028- 0.6128

For 6 straight weeks the Australian Dollar (AUD) has outperformed the British Pound (GBP), the cross reaching 0.5300 (1.8860) late Friday a late June high. Risk action Monday saw the AUD give back gains to 0.5265 (1.9000) as markets await this week’s key RBA rate announcement data. Odds for the RBA to hike from 4.1% later today is slim given recent inflation data and Retail Sales prints. We see resistance at 0.5250 (1.9040), the 50-day MA, price could resume its trajectory towards 0.5320 (1.8800) over the week.

Current Level: 1.8996
Resistance: 1.9900
Support: 1.8600
Last Weeks Range: 1.8857 – 1.9129

The New Zealand Dollar (NZD) clocked 0.5700 (1.7550) prior to the weekly close against the Euro (EUR) , a 2-month late July high in the pair. After a breakout past 0.5650 (1.7690) mid last week price could extend further to the topside and retest the 0.5740 (1.7430) area this week if the RBNZ Wednesday is hawkish. The RBNZ cash rate will remain at 5.5% for now but may signal intentions to policy going forward.

Current Level: 1.7642
Resistance: 1.8400
Support: 1.7390
Last Weeks Range: 1.7541 – 1.7906

The New Zealand Dollar (NZD) clocked 0.5700 (1.7550) prior to the weekly close against the Euro (EUR) , a 2-month late July high in the pair. After a breakout past 0.5650 (1.7690) mid last week price could extend further to the topside and retest the 0.5740 (1.7430) area this week if the RBNZ Wednesday is hawkish. The RBNZ cash rate will remain at 5.5% for now but may signal intentions to policy going forward.

Current Level: 0.5668
Support: 0.5750
Resistance: 0.5435
Last week’s range: 0.5584 – 0.5700

The New Zealand Dollar (NZD) picked up late points heading into the weekly close against the British Pound (GBP) extending from 0.4890 (2.0450) to 0.4935 (2.0270) around where it closed. This week’s key data is the Reserve Bank of New Zealand rate announcement and policy statement. While no change is predicted from 5.5% analysts will be looking for clues as to when a further 25-point hike will take place. Prices into Tuesday hover around 0.4915 (2.0350) well below the game line moving average suggesting bias is still cemented to the topside.

Current Level: 2.0358
Resistance: 2.1600
Support: 1.9800
Last Weeks Range: 2.0271- 2.0584

The New Zealand Dollar (NZD) picked up late points heading into the weekly close against the British Pound (GBP) extending from 0.4890 (2.0450) to 0.4935 (2.0270) around where it closed. This week’s key data is the Reserve Bank of New Zealand rate announcement and policy statement. While no change is predicted from 5.5% analysts will be looking for clues as to when a further 25-point hike will take place. Prices into Tuesday hover around 0.4915 (2.0350) well below the game line moving average suggesting bias is still cemented to the topside.

Current Level: 0.4912
Resistance: 0.5050
Support: 0.4630
Last Weeks Range: 0.4858 – 0.4933

Both central banks- the RBA and RBNZ will announce cash rates along with statements this week, both expected to widely keep rates on hold at 4.10 and 5.50% respectively. The New Zealand Dollar (NZD) has pushed up on the Australian Dollar (AUD) over the last 10 days, clearing resistance at 0.9320 (1.0730) to reach 0.9350 (1.0695) early today, a fresh high not seen since earlier in May this year. On the chart it’s thin air all the way to 0.9460 (1.0570), unless the Aussie gets a boost from somewhere this week we might continue to see more weakness in the currency.

Current Level: 1.0706
Resistance: 1.0900
Support: 1.0550
Last Weeks Range: 1.0716 – 1.0815

Both central banks- the RBA and RBNZ will announce cash rates along with statements this week, both expected to widely keep rates on hold at 4.10 and 5.50% respectively. The New Zealand Dollar (NZD) has pushed up on the Australian Dollar (AUD) over the last 10 days, clearing resistance at 0.9320 (1.0730) to reach 0.9350 (1.0695) early today, a fresh high not seen since earlier in May this year. On the chart it’s thin air all the way to 0.9460 (1.0570), unless the Aussie gets a boost from somewhere this week we might continue to see more weakness in the currency.

Current Level: 0.9331
Resistance: 0.9480
Support: 0.9175
Last Weeks Range: 0.9246 – 0.9331

The New Zealand Dollar (NZD) reached 0.6050 late in the week against the US Dollar (USD) but has since been in freefall. Reversing gains late Friday, the cross continued its decline to 0.5950 as I write, risk conditions favouring the safe haven greenback amid earlier uncertainty with a US govt shutdown which has been narrowly avoided. It’s a hard lesson on how momentum can shift in a heartbeat. One day buying USD above 0.6000 the next well below these levels. However, we will need to see a break past 0.5930 to signal an exit from the bull trend in play now. Wednesday’s RBNZ cash rate release and policy statement may give clues as to future policy. It’s our view that recent interest rate hikes have done enough to filter higher cost impacts through the economy. Cuts are still expected to get underway late in 2024. Key data late in the week comes in the form of Non-Farm Payrolls

Current Level: 0.5942
Resistance: 0.6100
Support: 0.5850
Last Weeks Range: 0.5898 – 0.6048

Market Overview

Key Points:

• The US has narrowly avoided its 22nd shutdown in 50 years after Republicans and the Democrats agreed to pass a last-minute spending plan. The new deadline is 17 November – if no deal is struck mass government departments will close.
• Japan’s third quarter Tankan report suggests that businesses are expecting inflation to stay high for some time above 2.0% over the next 5 years.
• New Zealand August Building Permits -6.7% m/m vs -5.4% prior
• ECB’s Vasle- We’re most likely done with rate hikes.
• Chinese Manufacturing worsened in September releasing at 50.6 vs 51.1 expected. The figure is viewed as expansion but overall, the sector is well below a decent pace of growth.
• The New Zealand Dollar (NZD) was the strongest currency over the month of September while the British Pound (GBP) was the worst performer.