The Australian Dollar (AUD) inched lower against the New Zealand Dollar (NZD) on Tuesday, decreasing the price of AUDNZD to less than 1.0700. The price decreases after a major economic release. The technical bias might turn bearish because the pair’s price marked a higher low in the last upside move.
AUD/NZD Technical Analysis
As of this writing, the pair is being traded around 1.0684. The price of the pair may come across support around 1.0618, the 23.6% Fib level support ahead 1.0551, the key horizontal support and then another support level may hit the price around 1.0521, the low of May 16, 2019, as shown in the graph attached below.
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On the upside, a trend line may resist the price around 1.0754, ahead of another trend line resistance which may come across the price at 1.0782, and then 1.0838, the major horizontal resistance which is likely to resist the price strongly. The technical bias shall remain bullish as long as 1.0618, the major horizontal support level remains in place.
Australia’s RBA Interest Rate
The Australian Bank of Reserves has recently announced the interest rate which remains 0.75% this month as compared to 1.00% the month before, exactly meeting the economists’ expectation which was 0.75%.
The interest rate is considered a key factor to trigger the rate of inflation in the coming months. It is to be noted that if the reserve bank of Australia holds a hawkish view concerning the inflationary outlook of the country’s economy, it is supposed to be a bullish market for the Australian Dollar. On the other hand, a dovish attitude of the RBA leads to a bearish market for the Australian Dollar (AUD).
After considering the price behavior of the AUDNZD over the last couple of days, selling AUDNZD around current levels may be a good decision in a short to medium term. Likewise, holding a long term position may also work if the price gets a reversal around 1.0618, the key horizontal support level.