A1 Trading Company

Ticker tape by TradingView

July 22, 2021

Aussie Buck or Kiwi? Better Buy

Frank Cabibi

7/22/2021

AUDMore Bullish
NZDLess Bullish

Our outlook

Although both currencies are affected by global events for the most part, the Aussie buck is probably a safer bet considering a few factors around it. First, the buck relies heavily on gold production and is dependent on it performance in the Australian economy. The kiwi is mostly dependent on manufacturing and exporting commodities like milk and dairy products. If there is a slowdown in dairy production or the prices of dairy products declines, so does the kiwi's price.

https://www.globaldairytrade.info/en/product-results/whole-milk-powder/

The continuing decline of whole milk prices since March is not a good sign for New Zealand's economy, and when comparing them to other countries' currencies, they don't really have a bullish argument.

The reason I am still bullish on NZD is because of their announcement to raise interest rates by the end of this year. This is way ahead of the Australian statement that said the RBA will raise interest rates starting in 2023. However, Australia's raw material economy seems like a much better bet in today's global condition of low interest rates and rising inflation in the US, England, Europe and other parts of the world.

https://www.statista.com/statistics/1039391/australia-gold-production-volume/

The image above is a chart of gold production from 2020 to 2021 and forecasts to 2026. As Aussie's economy rebounds and currencies weaken with inflation, gold looks like a good long term bet. And that is good for AUD.

Trade Setups

NZDUSD

NU tests resistance on a falling trend line before retracing and showing rejection from that level. A lower low on the 4H chart suggests that the next move down to create another lower bottom.

AUDNZD

AN hits a double bottom and bounces up .38% on the day. One thing to look out for is the 50 Day and 200 Day moving average intersecting and crossing. If the 50 runs below the 200, it could be a sign that the pair will continue to fall. However, the double bottom has held up pretty well so far.

AUDUSD

Against the USD, the buck doesn't look too strong. Price made a lower low and is now coming up to test resistance coupled with a falling trend line on the 1D chart.

AUDCHF

I like this setups a lot. ACHF is up today after testing a former double top on the 1D chart. Price is now up against resistance and hovering around that level. If price breaks above, it could see a test at the 200 DMA, and if not, will probably test support again.

A1 Edgefinder

#1 Market Scanner Tool
Take 10% off using code "READER"
GET ACCESS NOW
Want to See Our Trades?

Join The VIP Community!

Our entries, exits & analysis
Live Webinar Coaching
Trading Chatrooms
Strategy Library 
Exclusive Trading Guides
Use Code "READER" for 10% OFF!
JOIN NOWJoin FREE Discord
Listen to More Episodes
Why the New FOMC Decision Matters

Yesterday, the Federal Open Market Committee (FOMC), the Federal Reserve’s policy-making body, implemented yet another 75 basis point interest rate hike. While this move was perfectly in line with market forecasts, Chair Powell’s comments following the subsequent press conference, in which he discussed the FOMC’s new set of economic projections, were significant. He continued to […]

Read More
Shocking CAD Inflation News

Statistics Canada released a surprising new batch of inflation data this morning: month-over-month CPI failed to meet market forecasts, declining by 0.3% instead of the anticipated 0.1%. Rather than being an outlier, the other measurements of CPI mostly followed suit, as both year-over-year Trimmed CPI and Median CPI likewise failed to meet expectations. Trimmed CPI’s […]

Read More
2 Paths for Aussie Bears

At 9:30 pm Eastern Time tonight, the Reserve Bank of Australia (RBA) will be publishing their latest round of monetary policy meeting minutes. While there is a chance that their intentions could come across as more hawkish than expected, they currently have little reason to be. Despite relatively low unemployment at 3.5%, steady GDP growth, […]

Read More
DISCLAIMER: All comments made by TraderNick’s Forex Group, LLC are for educational and informational purposes only. All comments should not be construed as investment advice regarding the purchase or sale of any securities or financial instrument of any kind. Please consult with your financial adviser before making an investment decision regarding any securities or financial instruments mentioned by TraderNick’s Forex Group, LLC. TraderNick’s Forex Group, LLC assumes no responsibility for your trading and investment results. All information on any of the platforms utilized by TraderNick’s Forex Group, LLC was obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. TraderNick’s Forex Group, LLC, its employees, representatives, and affiliated individuals may have a position or effect transactions in the securities and financial instruments herein and or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. Trading of any type involves very high risk and may not be suitable for all investors. TraderNick’s Forex Group, LLC, its subsidiaries and all affiliated individuals assume no responsibility for your trading and investment result. Read our full disclaimer here
Home
Edgefinder
VIP
Menu
homesmartphonelaptopmenu linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram