Asian equities markets were mixed in today’s trading. The Nikkei 225 closed lower in today’s trading by 142.0 points or 0.60% at 23,686.0. Meanwhile, the Hang Seng Index is trading in the red by around 180.0 points or 0.65% at 27,230.2. According to some analysts, losses today can be attributed to rising cases of the coronavirus. As of this writing, there are already 40,547 confirmed cases which is 15% higher from Saturday’s tally, while the death toll is now up at 910.
On the other hand, the Shanghai Composite Index is up by 14.524 points or 0.51% at 2,890.488. This may have been brought about by better-than-expected Chinese CPI for January. The annualized CPI reading printed at its highest level since November 2011 at 5.4% and topped estimates at 4.9%. The uptick in inflation is sometimes taken as a sign of increased economic activity and the surge in January’s reading reflects price increases leading up to the Lunar New Year.
AUDUSD also benefited from China’s CPI report. It is currently leading gains among the majors as it is up by 0.34% from its opening price. On the other hand, NZDUSD and USDJPY are virtually unchanged at 0.04% and 0.02%, respectively.
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AUDNZD Outlook
On the daily time frame, we can see that AUDNZD traded higher after finding support at its January lows at 1.0320. It actually looks like a double bottom chart pattern has formed. In forex trading, this is considered as a bullish reversal signal. A strong close above neckline resistance at 1.0460 could mean that AUDNZD may soon rally to 1.0560 and test the 100 SMA and 200 SMA.
On the other hand, a reversal candle around this price may indicate that there are still sellers in the market. AUDNZD may soon trade lower and re-test support at 1.0320.
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