Australian, NZ Dollars Advance On Rising Risk Appetite

The Australian and New Zealand dollars strengthened against their major counterparts in the Asian session on Monday amid rising risk appetite, as investors cheered signs of progress in the U.S-China trade talks.

U.S. President Trump's national security adviser Robert O'Brien said on Saturday that an initial trade agreement with China is still possible by the end of the year, but warned Washington would not turn a blind eye to what happens in Hong Kong.

Chinese President Xi Jinping said China wants to work toward a phase one agreement on the basis of mutual respect and equality but will fight back if necessary.

The next round of U.S. tariffs on Chinese goods is set to take effect on December 15th, potentially complicating efforts to reach an agreement.

The aussie rose to 4-day highs of 74.00 against the yen and 0.9039 against the loonie, from its early lows of 73.74 and 0.9023, respectively. The aussie is likely to find resistance around 76.5 against the yen and 0.95 against the loonie.

Reversing from an early low of 1.6239 against the euro, the aussie spiked up to a 6-day high of 1.6213. The aussie is seen finding resistance around the 1.60 level.

The aussie advanced to 0.6799 against the greenback, from a low of 0.6787 hit at 6:00 pm ET. Next key resistance for the aussie is seen around the 0.71 mark.

The kiwi climbed to 4-day highs of 0.6428 against the greenback and 69.93 against the yen, off its previous lows of 0.6405 and 69.61, respectively. On the upside, 0.66 and 71.5 are possibly seen as the next resistance levels for the kiwi against the greenback and the yen, respectively.

The kiwi appreciated to near a 2-week high of 1.7151 against the euro, following a decline to 1.7206 at 6:30 pm ET. The kiwi is likely test resistance around the 1.70 area.

The kiwi reversed from an early low of 1.0600 against the aussie, rising to 1.0577. If the kiwi rises further, 1.04 is possibly seen as its next resistance level.

Looking ahead, German Ifo business sentiment index for November is due out in the European session.

Canada wholesale sales for September will be released at 8:30 am ET.