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24 Feb 2015
AUD/NZD: Parity on the horizon
FXStreet (Guatemala) - AUD/NZD is currently trading at 1.0358 with a high of 1.0374 and a low of 1.0356.
AUD/NZD is building a case back again for a test of the downside towards parity. 1.0430 caps the pair on minor recovery attempts while 1.0300 acts as support. however, analysts at ANZ explained that while they strongly believe that the degree of divergence between the two economies does not justify the level in the cross, this has been the case for some time. "This means that for a more sustained reversion to occur we need to see a significant shift in the fundamental balance of risks between Australia and New Zealand."
The analysts explained that, in the short-term, this does not look like it is on the horizon and as such, they said, forecasting a turnaround at this point is unjustified. "In the near term momentum, positioning and short-term relative economic surprises will dominate price action. Topside resistance is likely to remain around 1.06/07 until a more obvious convergence occurs on the economic front, while on the downside we would use dips to parity to accumulate."
AUD/NZD is building a case back again for a test of the downside towards parity. 1.0430 caps the pair on minor recovery attempts while 1.0300 acts as support. however, analysts at ANZ explained that while they strongly believe that the degree of divergence between the two economies does not justify the level in the cross, this has been the case for some time. "This means that for a more sustained reversion to occur we need to see a significant shift in the fundamental balance of risks between Australia and New Zealand."
The analysts explained that, in the short-term, this does not look like it is on the horizon and as such, they said, forecasting a turnaround at this point is unjustified. "In the near term momentum, positioning and short-term relative economic surprises will dominate price action. Topside resistance is likely to remain around 1.06/07 until a more obvious convergence occurs on the economic front, while on the downside we would use dips to parity to accumulate."