AUD/NZD heading for a new 16-month low at 1.05

• The Aussie is continuing to backpedal against the Kiwi.
• Market sentiment is bracing for China's response to tariff threats, expected from Xi Jinping's Boao Forum attendance.

The AUD/NZD is keeping on pace with the long-term bear trend, and the pair is knocking lower into 1.0520 after Business Confidence in New Zealand came out better than previous.

The NZD's NZIER first quarter Business Confidence came in at -11 percent, a negative number but still a slight improvement on the previous -12 percent, and the Aussie is tripping lower against the Kiwi as a result. The Aussie will be seeing NAB Business Confidence at 01:30 GMT, which is expected to come in at 12 versus the previous reading of 9, but the NAB Business Conditions indicator is expected to contract from 21 to 17 at the same time.

The Asia session is going to be hanging on the Boao Forum,  where China's President Xi Jinping will be speaking on matters and is expected to have a retort for the US' lasts round of tariff threats. Enflaming remarks from Jinping could spark broader market risk aversion if Xi chooses to match Trump's double-down efforts.

AUD/NZD Levels to watch

Support is very thin for the pair, with the last swing low into 1.0500 the only support level after the pair sunk to a 16-month low yesterday, but the Aussie can expect a heavy fight from the 1.0400 level, a previous congestion zone from mid-2017, while resistance is struggling to keep up with the falling pair, and 1.0600 at the last swing high and March's highpoint of 1.0650 standing as barriers to any bullish corrections.