- AUD/NZD is trading at 1.0428, down from the 1.0488 highs and up from the 1.0396 lows.
- Reuters reported that China had banned Australian coal imports to northern China ports.
AUD/NZD was damaged overnight as the Aussie took a showing following the Reuters headlines that had reported China banning Australian coal imports to northern China ports.
However, analysts at Westpac explained that if the report is correct, this applies to only 10% of China’s coal imports from Australia. “Early Friday, Australia treasurer Frydenberg claimed that there was no ban”. Nevertheless, AUD/NZD fell to 1.0397 lows but has started to recover, bearing in mind yesterday’s impressive jobs data. However, the dollar and US yields were firmer following the markets take on the FOMC minutes, figuring that there are still possibilities of a rate hike in 2019.
“Robust jobs data should encourage the RBA but housing market remains a threat and China trade is a new concern. Offshore factors should limit AUD downside though,” the analysts at Westpac explained.
Eyes on the Kiwi and NZ Q4 GDP
With respect to AUD/NZD, Kiwi remains at risk around NZ Q4 GDP later in March as the next key data point for the cross which could break the restraints that traders have been confined to between 1.0367 and 1.0488.
AUD/NZD’s horizontal support line est. since June 2017, was tested again on 13th Feb 2019 marking a fresh swing low at 1.0367. On the flipside, bulls are looking towards an upside target that is located at the 38.2% fibo target in the 1.0560s. Technicals are neutral for the time being, but a breakthrough R2 at 1.0490 should but bulls back in charge.