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AUD/NZD Whacked Twice; Ready for Bearish Continuation

AUD was pressured during the beginning of the 4/24 session when inflation data came out for Q1. It wasn't that low, coming in at 0.6% for the quarter, and 2.9% on the year, but traders did use it as an excuse to cool off the hot Australian dollar.

NZD was then boosted after the RBNZ raised the key interest rate from 2.75% to 3.0%, and sounded hawkish on inflationary risk.

The AUD/NZD reversed a rally from 1.0520 to 1.0915. The 4H chart shows that it broke below a rising trendline after the AUS inflation data, then extended lower after the RBNZ statement.

(audnzd 4h chart, 4/24)

In the near-term, we might anticipate some support around 1.0730-40, especially with the stochastic below 20 and RSI below 30. However looking at the daily chart, following the trend, we might expect some further downside risk. 

(audnzd daily chart, 4/24)

As you can see in  the daily chart, the market has been persistently bearish in 2013, but has been sideways since Dec. 2013 and through 2014 so far. This is a bearish-neutral market. In this mode, AUD/NZD found resistance below the 1.0945 2014-high and consolidation resistance. Now a bearish attempt is developing, so look out for a swing towards the 1.0486 to 1.0520, 2014-lows.