Aussie still feeling the weight of the RBA decision yesterday | Forexlive
The aussie is staying under pressure in trading today, as the fallout from the RBA policy decision yesterday continues. It is the major laggard on the day with AUD/USD declining further towards 0.6700, as we also see AUD/NZD fall to its lowest levels in a year after the RBNZ surprised with a 50 bps rate hike earlier today.
The divergence between central bank policies is the key driver for price action today with AUD/NZD in particular dropping from near 1.0800 in the past few weeks to 1.0600 at the moment. In the bigger picture, it is fast approaching a critical point for the pair with key support potentially under threat:
It’s pretty much a series of steps to watch out for in AUD/NZD if traders continue to view a wide divergence between the two central banks. The key trendline support (white line) at around 1.0575 is up next and then we will start to move towards 1.0500 and then the 1.0300 level.
The big one to watch will be the 2020 low at parity but I reckon we are most likely to see the RBNZ also head to the sidelines before we get to that.
Going back to AUD/USD above, the pair is also under pressure even with a struggling dollar and that says a lot about aussie sentiment at the moment. A drop back below its own 200-day moving average today sees sellers regain back some control with price action now dragged back into consolidation range between 0.6600 and the 200-day moving average around 0.6747 at the moment.