Antipodeans: better bid and targetting key resistances - Westpac

Analysts at Westpac offered the market outlooks for the antipodeans. 

Key Quotes:

"AUD/USD 1 day: Sound support in front of 0.7600 should allow for a push towards 0.7700

AUD/USD 1-3 month: While further gains to around 0.77 are possible during the month ahead, driven in part by the faltering US dollar and yield-chasing flows, the AUD is losing energy (perhaps a reflection of its declining yield advantage). By year end, there’s a case for a correction towards 0.74 if the Fed tightens in December as we expect. (13 Sep)

NZD/USD 1 day: A good rebound back above 0.7235 may allow for a push back towards 0.7325

NZD/USD 1-3 month: During the month ahead another probe above 0.75 is possible, driven by good NZ economic news, a still-vulnerable US dollar, and yield-chasing inflows. By year end, there’s a case for a correction towards 0.70 if the Fed tightens in December as we expect. (13 Sep)

AUD/NZD 1 day: After recent spike to 1.0545, likely to consolidate in 1.0450-1.0525 range

AUD/NZD 1-3 month: Risks of further losses into the 1.01-1.02 zone remain. By year-end, we expect a rebound towards 1.06, the cross well below fair value implied by interest rates, commodity prices and risk sentiment. (8 Sep)

AU swap yields 1 day: The 2yr should open at 1.67% while the 10yr should open at 2.13%.

AU swap yields 1-3 month: If the RBA sits tight at 1.5% during the remainder of this year the 2yr should eventually find a base around 1.60%. However the main risk is that markets continue to price in a sub-1.5% cash rate. (15 Aug)

NZ swap yields 1 day: NZ 2yr swap rates should open around 2.01% and test 2.00%, while the 10yr could dip further below 2.50%.

NZ swap yields 1-3 month: Slightly lower. The OCR is likely to be cut to 1.75% in November. That should result in a 2yr swap rate of around 1.90%, although the risk is it could be lower if markets expect a 1.5% terminal OCR. (15 Aug)."