AUD/NZD Price Analysis — November 16

The AUD/NZD traded with a sideways bias through the early European session on Monday, as the Reserve Bank of New Zealand (RBNZ) left its official cash rate (OCR) unchanged at 0.25% and promised to keep its rates the same until March 2021.

The Aussie and the Kiwi traded strongly against other top cryptocurrencies last week as a result of the renewed demand for riskier assets on the back of positive news relating to a COVID-19 vaccine from Pfizer.

However, the risk tone got killed by new information about the vaccine’s distribution methods, dosage, and shelf life. The risk most was further dampened by the erratic rise of COVID-19 cases in the United States, which threatened to derail any significant economic recovery in the near-term.

Meanwhile, the recent announcement by the RBNZ about leaving their OCR unchanged continues to strengthen the prospects of the NZD against the AUD and other currencies. The RBNZ initiated a new funding program last Wednesday that aims at reducing costs for lenders while keeping its interest rate at record lows. The bank also mentioned its readiness to shift to negative rates to support the economy if need be.

That commitment and the new funding -for-lending program (FLP) for banks forced markets to eradicate the prospects of negative rates. This stance drove the Kiwi higher last week, and we could see a continuation of the surge this week.

AUD/NZD Value Forecast — November 16

AUD/NZD Major Bias: Sideways

Supply Levels: 1.0725, 1.0844, and 1.0934

Demand Levels: 1.0600, 1.0500, and 1.0400

The AUD/NZD bulls remain in a fight to secure the 1.0600 psychological support. A break below that level could precipitate renewed declines to the 1.0500 support and lower.

Given the current strength surrounding the NZD, a downward continuation in the AUD/NZD seems very likely at the moment.

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