AUD/NZD Price Analysis — November 9

The AUD/NZD traded in a tight range between 1.0685 and 1.0725 in the mid-European session on Monday and was last spotted trading at the 1.0725 resistance.

On Friday, Australia released its AIG Performance of Services Index, which showed a decent improvement from 36.2 in September to 51.4 in October.

Meanwhile, the Aussie recorded a short-lived decline on Tuesday, following the Reserve Bank of Australia’s monetary policy decision. As was widely expected, the RBA announced that it would be cutting its interest rate to a record low of 0.01%. Also, RBA policymakers disclosed that they planned on buying AUD 100 B of 5y-10y bonds over the next six months. Although this could have some damaging effects on the AUD, RBA Governor Philip Lowe remains optimistic about the near-term prospects of the country’s economic progress, adding that it is highly unlikely for the bank to publish negative rates.

That said, AUD/NZD traders’ focus will now be shifted to the Reserve Bank of New Zealand’s policy decision on Wednesday.

Although it is expected that RBNZ policymakers will leave interest rates unchanged at 0.25%, they are also expected to announce a new monetary policy tool in Wednesday’s meeting to boost borrowing costs for lenders and boost economic growth.

AUD/NZD Value Forecast — November 9

AUD/NZD Major Bias: Sideways

Supply Levels: 1.0750, 1.0800, and 1.0844

Demand Levels: 1.0650, 1.0600, and 1.0500

The AUD/NZD is currently trading in a sideways momentum as markets reel from last week’s US elections-induced volatility. This pair is trading within a descending channel and we expect the ensuing momentum to be bearish, given the state of affairs surrounding the AUD.

That said, we could see a temporary break above the 1.0725 resistance, followed by additional declines to the 1.0600 level.

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