#AUDNZD @ 1.07345 is looking for a cushion around 1.0740 as the focus shifts to RBA policy. (Pivot Orderbook analysis)

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• AUD/NZD is looking for a cushion around 1.0740 as the focus shifts to RBA policy.
• A neutral stance is widely anticipated from the RBA as Australian inflation is consistently decelerating.
• Weak NZ Employment (Q1) data might allow the RBNZ to consider a pause in the policy-tightening spell.

The pair currently trades last at 1.07345.

The previous day high was 1.0766 while the previous day low was 1.0688. The daily 38.2% Fib levels comes at 1.0736, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.0717, expected to provide support.

The AUD/NZD pair has corrected to near 1.0740 after failing to sustain a rally above 1.0760 in the Asian session. The cross is expected to remain in action ahead of the interest rate decision by the Reserve Bank of Australia (RBA).

A continuation of a neutral policy stance is anticipated from RBA Governor Philip Lowe. Australian inflation is consistently declining for the past three months. The monthly Australian Consumer Price Index (CPI) has already decelerated from the peak of 8.4% recorded in December to 6.3% in March.

Also, RBA policymakers are confident that the Australian economy is expected to face a severe slowdown due to higher interest rates. This may weigh more pressure on Australian inflation ahead.

Apart from that, Wednesday’s Australian Retail Sales data will be keenly watched. Monthly Retail Sales are expected to remain steady at 0.2%.

On the New Zealand front, investors are keenly awaiting the release of the Employment data (Q1), which is scheduled for Wednesday. As per the estimates, the Employment Change is expected to remain steady at 0.2%. While the Unemployment Rate is seen rising to 3.5% from the former release of 3.4%. The quarterly Employment Cost Index is seen unchanged at 1.1%. Fewer job additions and a higher jobless rate would allow the Reserve Bank of New Zealand (RBNZ) to consider a pause in the policy-tightening process.

Investors should note that RBNZ Governor Adrian Orr pushed its Official Cash Rate (OCR) higher surprisingly by 50 basis points (bps) to 5.25% in April to strengthen its defense against persistent inflation.

Technical Levels: Supports and Resistances

AUDNZD currently trading at 1.0742 at the time of writing. Pair opened at 1.0753 and is trading with a change of -0.1 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 1.0772, 50 SMA 1.0783, 100 SMA @ 1.0806 and 200 SMA @ 1.0938.

The previous day high was 1.0766 while the previous day low was 1.0688. The daily 38.2% Fib levels comes at 1.0736, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.0717, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1.0705, 1.0658, 1.0627
• Pivot resistance is noted at 1.0783, 1.0814, 1.0861

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