The RBA left the interest/cash rates unchanged at 3.5 %, a move most investors were expecting and at time of writing has only caused a minor drop in the Aussie Dollar against other currencies like the Greenback and the Kiwi. However, the NZD has been climbing in value against its counterparts such as the Euro, AUD and USD for some time now. One of the best example of the strengthening Kiwi is the EUR/NZD chart which has shown the NZD to be gaining value against the EURO quite steadily since January 2009. The AUD/NZD has been much more volatile however, with larger swings both up as well as down thanks to the Aussie Dollar's fluctuations for the most part. Last week, prices on the AUD/NZD hit the 50% retracement level of the most recent Bullish trend that started in mid-April and ended on May 18, 2012. The pair reacted to this key level of resistance by falling for the next 2 days and has now closed below the Weekly Pivot at 1.2754. Adding to the Bearish indications are the 62EMA sitting above at roughly the same level as the Monthly Pivot as well as the 5 & 13 period EMA's beginning to curl downward once again after pinching together as a result of the pull back. Unless price can close above 1.2800, it is highly probable that prices will continue to improve for the Kiwi, sending the AUD/NZD chart lower, possibly to retest the April low at 1.2519. Along the way there will be support at 1.2690, 1.2656, 1.2613 and 1.2552. If price reverses at this point and begins heading higher, look for resistance at key levels such as 1.2833, 1.2894 & 1.2928.
Happy Trading