AUD/NZD Price Analysis: Rallies 70 pips on RBA’s bold rate hike, bulls eye yearly top near 1.1200
- AUD/NZD crossed one-month-old horizontal hurdle on the RBA’s higher-than-expected rate hike.
- RBA beats market forecasts with 0.50% interest rate lift, cites inflation as the key cause for the bold move.
- The sustained upside can direct bulls towards May’s top, 2017 peak.
- Bears need validation from 200-SMA to retake control.
Alike other Aussie pairs, AUD/NZD also portrayed a stellar reaction to the RBA’s heavy rate hike while crossing the monthly hurdle. That said, the cross-currency pair rallied more than 60 pips to 1.1164 during the initial jump before retreating to 1.1142 amid Tuesday’s Asian session.
The Reserve Bank of Australia (RBA) crossed wide market expectations by lifting the benchmark interest rate by 50 basis points (bps) to 0.85%. The RBA Rate Statement, however, appears less lucrative for the AUD/USD bulls and seemed to have probed the quote after the initial knee-jerk reaction to the RBA’s rate hike.
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Given the strong fundamental push, as well as the quote’s ability to cross the immediate hurdle, AUD/NZD is likely to challenge the yearly top, marked in May, surrounding 1.1195.
Following that, a run-up towards the year 2017 peak around 1.1300 can’t be ruled out.
On the flip side, the resistance-turned-support line, near 1.1110, as well as the one-week-old rising trend line around 1.1070, challenges the AUD/NZD bears.
Even if the AUD/NZD bears manage to conquer the 1.1070 support, the 200-SMA level of 1.1000 will be a tough nut to crack for the pair sellers.
AUD/NZD: Four-hour chart
Trend: Further upside expected