AUDNZD is one of the major FX crosses that is making the biggest moves today. This is because AUD is one of the best performing G10 currencies today while NZD is one of top laggards.
AUD caught a bid following testimony of RBA Governor Lowe. Lowe said that RBA policy has now entered a 'calibration phase'. This means that the Bank will take time to analyze data and decide whether more rate hikes are needed. Lowe said that all options remain on the table and markets have actually taken his testimony as hawkish. Markets are now pricing in a 4.24% rate peak in February 2024, suggesting a 70% chance of 25 bp rate hike by then. However, it should be said that this was Lowe's final testimony as he is set to leave RBA next month. Having said that, his comments may not be fully reflective of a policy that his successor will undertake.
Start investing today or test a free demo
Open real account TRY DEMO Download mobile app Download mobile appOn the other hand, NZD is pulling back following the release of manufacturing PMI for July from New Zealand. Index dropped from 47.4 to 46.3 in July, marking the fifth consecutive month of sub-50 recessionary readings. This was also the lowest reading since August 2021, when New Zealand was still fighting the Covid pandemic.
Taking a look at AUDNZD chart at D1 interval, we can see that the pair has been trading mostly sideways recently with a slight upside tilt. An ascending triangle pattern can be spotted on the chart with the 1.1050 price zone acting as the upper limit and the upward trendline acting as the lower limit. Pair broke above 50- and 200-session moving averages today and is looking towards the 1.0925 zone that marks the neckline of the double bottom pattern (DB). A break above the 1.0925 zone may trigger an upward move towards 1.1130 - the textbook range of the DB pattern. However, this would mean breaking above the 1.1050 zone - the upper limit of the triangle pattern - what would be seen as a signal for an even bigger upward move as textbook range of the upside breakout from the triangle pattern can be found in the 1.1642 area.
AUDNZD at D1 interval. Source: xStation5
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
