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AUD/NZD hits the watchlist once again as the Kiwi has quite a few catalysts ahead to get volatility hopping. Will the bears stop today’s bounce or is there more upside room to run?

Before moving on, ICYMI, today’s Daily U.S. Session Watchlist looked at EUR/NZD ahead of  NZ retail sales data, so be sure to check that out to see if there is still a potential play!

Intermarket Update:

Equity Markets Bond Yields Commodities & Crypto
DAX: 16,115.69 -0.27%
FTSE: 7,255.46 +0.44%
S&P 500: 4,682.94 -0.32%
NASDAQ: 15,854.76 -1.26%
US 10-YR: 1.629% +0.093
Bund 10-YR: -0.291% +0.005
UK 10-YR: 0.943% +0.01
JPN 10-YR: 0.074% -0.012
Oil: 78.11 -3.28%
Gold: 1,869.10 +0.81%
Bitcoin: $59,928.75 +0.29%
Ether: $4,228.24 +0.72%
Solana: $215.63 -3.73%

Fresh Market Headlines and Economic Data:

President Biden chose Jerome Powell to lead the Fed for a second term

New Zealand Retail Sales: -8.1% in the September quarter, above expectations but below June quarter read of 3.3%

U.S. existing home sales rose 0.8% in October according to National Association of Realtors

“El Salvador plans to create a ‘Bitcoin City’ and raise $1 billion via a ‘Bitcoin Bond’

Upcoming Potential Catalysts on the Economic Calendar

New Zealand Retail Sales at 9:45 pm GMT
Australia Manufacturing & Services PMI at 10:00 pm GMT
RBA Kohler speech at 1:05 am GMT (Nov. 23)
France Manufacturing & Services PMI at 8:15 am GMT (Nov. 23)
Germany Manufacturing & Services PMI at 8:30 am GMT (Nov. 23)
Euro area Manufacturing & Services PMI at 9:00 am GMT (Nov. 23)
U.K. Manufacturing & Services PMI at 9:30 am GMT (Nov. 23)
Bank of England Haskel speech at 11:00 am GMT (Nov. 23)

If you’re not familiar with the forex market’s main trading sessions, check out our Forex Market Hours tool.

What to Watch: AUD/NZD

AUD/NZD 1-Hour Forex Chart
AUD/NZD 1-Hour Forex Chart

On the one hour chart of AUD/NZD above, we saw a solid bounce in the pair during today’s session, recovering from last week’s bearish pressure after RBA Governor Lowe shot down rate hike speculators. Today’s move was likely due to the Kiwi, which was broadly lower on potential profit taking ahead of this week’s monetary policy statement from the Reserve Bank of New Zealand on Wednesday.

That brought the market to a significant area of interest around the 1.0380 – 1.0400 area, which in the past has been both minor support area resistance levels. This area is also the 50% – 61% Fibonacci retracement area of the swing move lower we saw last week. 

With stochastic signaling potentially overbought conditions, will this area draw in short-term sellers? Or will the momentum carry the pair beyond the 1.0400 major psychological level? Well, that may be determined by how traders price in the just released New Zealand retail sales data and Australian PMI data. Both are not normally market movers and with both events coming in better-than-expected or previous, it looks like the fundies won’t be a big driver in the short-term.

That means it’s likely technical players may dominate the pair in the upcoming session, and if we see bearish reversal patterns form in this area, the odds are pretty good of a short-term move lower, especially if risk sentiment leans positive.

But as of right now, broad risk sentiment seems to be leaning more negative, and if that can push AUD/NZD solidly above 1.0400 and stay there, it’s likely momentum players could take the pair higher to retest the next swing high around 1.0450.