After stalling a mere 21 pips above parity AUDNZD reversed at break-neck speed and hasn't looked back, leaving a break above 1.13 a question of 'when', not 'if'
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After stalling a mere 21 pips above parity AUDNZD reversed at break-neck speed and hasn't looked back. The primary cause of this rapid reversal are two-fold: Traders assumed that, for now at least, RBA planned no further rate cuts whilst RBNZ were looking to cut their overnight cash rate.
This resulted in the 1.13 target being achieved much sooner than I had envisaged and we now find ourselves on the cusp of breaking this key level too.
Focussing on price, the trajectory of the gains from parity have been seen at a greater pace than the bearish move which preceded it (which itself was also impressive). So now suspect we have in fact seen a multi-year low on AUDNZD and for price to break above 1.13 probably sooner than later.
I would prefer to see if we get a clean break above 1.13 before seeing buy-limit orders to catch any retracement towards this key level. As we approach 1.46 to 1.15 we meet the 38.2% retracement from 1.0026 low to the 1.378 high and the Monthly R3.
Alternatively, if price edges lower away from 1.13 I may consider buy-limits above 1.112 support to assume an eventual upper break of 1.13.
Due to the trajectory of the advance and the breakaway gap I suspect pullbacks to be relatively limited (38.2% or below, for example).