- AUD/NZD bears are being denied the central bank divergence, so far.
- AUD/NZD is taking on critical areas of resistance ahead of key AUD events.
AUD/NZD is defying the fundamentals between the central banks of the two nations, taking on technical resistance on the daily chart and eating into stops through 1.0420.
The Reserve Bank of Australia minutes are going to be an interesting event for AUD in the absence of anything else this week that might move the needle besides a speech by RBA Governor Lowe an hour later in the day. The following illustrates the technical picture heading into the events.
AUD/NZD daily chart
The daily chart shows that the price is moving in on the dynamic trendline resistance which would be expected to hold. This will also safeguard stops above the horizontal resistance near 1.0450.
AUD/NZD H4 chart
The 4-hour chart is showing signs of weakness, however, as the price leaves a downside wick that would be expected to be filled in. The bears will be in charge in doing so and testing below the dynamic trendline support. On a break of this support, the bears will be in the running for a downside daily extension below 1.0330.