Key Points
- The Aussie dollar traded higher against the New Zealand dollar after testing the 1.0570 support area.
- There is a crucial support trend line formed on the hourly chart of the AUDNZD pair, acting as a barrier for more losses.
- Earlier today, the Australian Import Price Index was released by the Australian Bureau of Statistics.
- The outcome was mixed, as there was a decline of 1% in the IMI in Q2 2016, compared with the previous quarter.
Technical Analysis
The Aussie dollar after a downside ride against the New Zealand dollar towards the 1.0570 level found support and started to move higher. There was a crucial support trend line formed on the hourly chart of the AUDNZD pair, which prevented the downside move.
The pair surged higher and broke the 23.6% Fib retracement level of the last drop from the 1.0724 high to the 1.0570 low.
On the upside, a successful close above the 21 hourly simple moving average is needed for more gains.
Australian Import Price Index
Earlier today during the Asian session, the Import Price Index that informs the changes in the price of imported products was released by the Australian Bureau of Statistics. The forecast was not lined up for a positive reading.
The result was mixed, as there was a decline of 1% in the Import Price Index in Q2 2016, compared with the previous quarter. The report added that the “Import Price Index fell 1.0% in the June quarter 2016. Through the year to the June quarter 2016, the Import Price Index fell 2.8%. The Export Price Index rose 1.4% in the June quarter 2016. Through the year to the June quarter 2016, the Export Price Index fell 8.7%”.
Currently, it looks like there is a chance of a minor dip in the AUDNZD pair before it can continue to trade higher in the near term.
