G10 FX

Research evidence excerpt

G10 FX

estimates. It is not necessarily a game changer to our view, as we were not short CHF waiting

for the SNB to intervene, however it does continue to show the SNB will rely more on rhetoric

than actual market action.

AUD Despite a weaker USD and higher equities, AUD was a clear underperformer yesterday, losing

ground on various crosses and even seeing AUDUSD lower despite the 0.25% fall in the DXY

during our session. AUD underperforming on days when the USD is weaker has been a recent

theme and is a little concerning for AUD bulls. Maybe the fall in Gold once again weighed,

although that didn’t seem to impact ZAR. The RBA minutes O/N were consistent with recentNZD

communications and confirms a still hawkish bias although the Q2 inflation print on July the

29th, will be the deciding factor for me in deciding whether the hiking cycle is now complete or

not. Today is all about Month/Quarter/Half year rebalancing flows (maybe that was in play

yesterday?) and while I make no prediction as to what might happen today, we can expect some

volatile moves and if AUDUSD can remain above the 200DMA ~0.6862, I may revisit a tactical

long, with only a 2 day close below that level calling for a reassessment. NZD outperformed O/

N after ANZ Activity and Business Survey data rose. This is contrast to the bleak NZIER

Survey, although that was taken during the height of the M/E conflict while last night’s survey

had the advantage of including the recent peace deal. Regular readers will know that I have been

downbeat on the NZ economy, but technically, AUDNZD is starting to look interesting to those

of you who have recently discussed downside with me. The 50D can be found ~1.2165, short

term trendline support is at 1.2131, while the 100D is ~ 1.2075. Next week’s RBNZ (more on