- AUD / NZD fails to respect Friday’s rebound from seven-month low.
- Retail sales in New Zealand rose 28% in the third quarter from an earlier contraction of 14.6%.
- 10 day SMA, July low limits immediate upside, bears can observe 50% Fibonacci retracement level up March-August.
AUD / NZD remains heavy near late April low while taking rounds to intraday low around 1.0530 at the start of the Asian session on Monday. The pair recently fell from 1.0555 to 1.0531 after third quarter (Q3) retail sales from New Zealand (NZ) offered a big beat compared to the previous version.
Not only did New Zealand retail sales increase beyond the previous -14.6% to 28%, but non-auto retail sales, mainly known as Core Retail Sales, also recovered by -13 , 7% before + 24.1% QoQ in the third quarter.
Read: New Zealand retail sales unexpectedly surge 28% in third quarter, NZD / USD rebounds
Following the data, the pair extends its reversal from a confluence of the 10-day SMA and the July low, currently near 1.0563 / 58, which in turn drives the quote down of several days recently flashed from 1.0510.
During the pair’s further weakness beyond 1.0510, the 50% Fibonacci retracement level near 1.0480 and the March 25 high around 1.0220 will attract AUD / NZD bears.
On the contrary, an upside release of 1.0563 on a daily close is not enough to remind bulls like a 200 day SMA and a downtrend line from October 08, around 1.0655 and 1.0700, stand to challenge the rally moves.
AUD / NZD Daily Chart