After rising significantly on Wednesday and Thursday, AUD/NZD accelerated to the upside on Friday and climbed to 1.0542, hitting the highest level in a month. The pair continues to recover after falling last week to 1.0230, the lowest level in a year.
During the week, while in Australia, the new governor of the Reserve Bank of Australia, Philip Lowe gave an upbeat speech about the state of the economy in his first public appearance, the Reserve Bank of New Zealand, left interest rates unchanged but left the door open to more easing.
The bias in the RBNZ weakened the kiwi in the market. The Mexican peso, the Pound, and the New Zealand dollar are the worst performers in currency market over the week. NZD/USD approached 0.7400 after the Federal Reserve decision and now is under 0.7250, testing September lows.
AUD/NZD at the 20-WMA
From the level it opened on Monday, AUD/NZD has risen 230 pips so far. The price is now testing the 20-week moving average. So far the pair has been unable to rise and consolidate on top.
If it continues to rise and posts a weekly close on top of that MA, it would be the first time to do so since April and it could signal a potential interim bottom. On the opposite direction, failure to break higher could clear the way for a bearish correction after a 300-pip rally from 2016 lows.
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