By Admiral Markets
Whilst most economists are now predicting further cuts by the RBA, some saying even the cash rate may drop to 1% (meaning another -75bps), this is putting some downward pressure on the AUD.
As for the NZD, it is largely reliant on its Dairy trade as its key exports, and there has been a lot of media on the weak dairy prices. Keep an eye out for the RBNZ to intervene if the AUDNZD approaches parity, as its one of its key export markets, and they may follow the RBA with further rate cuts which may see the NZD change direction against the AUD.
Technically POC comes within 1.0650-60 zone (L3,23.6, Breakout-retest) while deeper retracement may target 1.0685-95 zone (61.8, DPP, H3,inner trend line, EMA89). We could expect fresh sellers to kick in within POC zones targeting 1.0615 and 1.0570.
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Article by Admiral Markets
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Source: AUDNZD showing both technical and fundamental alignment
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