AUDNZD: Technical Review of the Week

According to preliminary readings, ANZ’s business confidence fell from -13.4 to -18.1 in November. The outlook for its own activity fell from 21.7 to 15.6. Export intentions fell from 8.6 to 8.0. Investment intentions fell from 13.8 to 11.6. Intention to work jumped from 10.9 to 16.1. Cost expectations rose from 87.2 to 89.0. Price intention fell from 65.6 to 64.6. Inflation expectations jumped sharply from 3.45 to 4.33. ANZ said: “Overall, the survey shows understandable vigilance as we enter a world of COVID endemics. The only certainty is that the costs are very high.”

Meanwhile, Westpac consumer sentiment in Australia rose 0.6% to 105.3 in November, up from 104.6. Looking at some details, the index of economic conditions for the next 12 months increased from 103.2 to 106.6, as the reopening of major cities seems to have underpinned confidence. The unemployment expectations index fell notably from 107.1 to 95.3, as more consumers expected unemployment to fall rather than rise. Westpac expects the RBA to continue its current AUD 4 billion per week asset purchases as planned through February and then reduce it to AUD 2-3 billion until its next possible review in May. However, if the RBA judges that the pace of achieving its targets is satisfactory, it may decide on a reduction to AUD 2 billion per week.

AUDNZD, D1 – The pair is still in descending bias within a bearish structure and forming the 5th Elliot Wave. The 200-day EMA has restrained the 1.0277 rebound and stalled at the resistance level around 1.0600. The 1.0277 support is a key support level; a decline below this level could extend the descending 5th wave to the 1.0000 round level. As long as this support holds, the rebound will resume to recoup some of this year’s losses to the 1.0433 resistance; 1.0527 and 1.0610. The asset price as measured by the RSI seems to be bouncing around the oversold area, while overall the outlook is still limited bearish.

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Ady Phangestu

Market Analyst – HF Educational office – Indonesia

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