Despite the range-bound prices in the AUDNZD, we anticipate a larger rebound in the exchange rate as the relative strength index bounces off of oversold territory. As the pair bounces back ahead of the 50.0% Fibonacci retracement from the 2008 low to the 2011 high around 1.2200, we may see a move back towards the 38.2% Fib (1.2580), and we will look to sell rallies amid the deviation in the policy outlook. As our bias remains bearish, we will stick to the sidelines for the time being, and will press the aussie-kiwi lower over the near to medium-term as the downward trend from 2011 continues to take shape.
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