Forex Market: AUD/NZD daily trading outlook

Yesterday’s trade saw AUD/NZD within the range of 1.0573-1.0662. The pair closed at 1.0586, shedding 0.09% on a daily basis, while extending the loss from last Thursday. It has been the 11th drop in the past twenty trading days. The daily low has been the lowest level since December 17th, when a low of 1.0573 was registered. In weekly terms, AUD/NZD lost 0.61% during the past week, while marking its fifth consecutive week of decline. AUD/NZD has depreciated 3.54% so far during the current month, following a 4.21% surge in November. The latter has been the sharpest monthly gain since June 2015.

At 13:59 GMT on Tuesday AUD/NZD was gaining 0.09% for the day to trade at 1.0596. The pair touched a daily high at 1.0601 at 13:40 GMT, undershooting the daily R2 level. Resistance may be encountered close to the hourly 100-period EMA (1.0613) and after that – within the 1.0625-1.0635 area, where the pair faced resistance on several occasions last week. Support, on the other hand, may be received in the area around the current daily low (1.0568). The latter has been the lowest level since November 3rd, when a daily low of 1.0566 was reached.

No relevant macroeconomic reports and other events, which may have an impact on AUD/NZD trading, are scheduled on Tuesday.

Correlation with Major Currency Pairs

Taking into account the week ended on December 27th and the daily closing levels of the currency pairs involved, we come to the following conclusions in regard to the strength of relationship:

AUD/NZD to USD/JPY (0.4182, or moderate)
AUD/NZD to USD/CHF (0.2047, or weak)
AUD/NZD to USD/CAD (0.1811, or weak)
AUD/NZD to AUD/USD (0.0571, or very weak)
AUD/NZD to NZD/USD (-0.3367, or moderate)
AUD/NZD to GBP/USD (-0.4911, or moderate)
AUD/NZD to EUR/USD (-0.5127, or strong)

1. During the examined period AUD/NZD moved strongly in the opposite direction compared to EUR/USD.

2. AUD/NZD moved almost independently compared to AUD/USD during the past week.

3. AUD/NZD moved to a moderate extent in one and the same direction with USD/JPY during the period in question, while moving to a moderate extent in the opposite direction compared to NZD/USD and GBP/USD.

Daily and Weekly Pivot Levels

By employing the Camarilla calculation method, the Tuesday pivot levels for AUD/NZD are presented as follows:

R1 – 1.0594
R2 – 1.0603
R3 (range resistance) – 1.0610
R4 (range breakout) – 1.0635

S1 – 1.0578
S2 – 1.0569
S3 (range support) – 1.0562
S4 (range breakout) – 1.0537

By using the traditional method of calculation, the weekly pivot levels for AUD/NZD are presented as follows:

Central Pivot Point – 1.0603
R1 – 1.0694
R2 – 1.0793
R3 – 1.0884

S1 – 1.0504
S2 – 1.0413
S3 – 1.0314