WHAT AFFECTS AUDNZD PRICE MOVEMENT?

In addition to their similar geographic location and considerable dependence on the natural resource trade, New Zealand and Australia are also major trading partners. This is why the AUDNZD rate tends to be influenced by factors in the local economy rather than by global factors or the risk factors associated with the US market.

1. Interest rate, monetary policy, and economic outlook:

AUDNZD is heavily influenced by domestic monetary policy, interest rates, and other economic data. For example, the dove or hawk monetary policy interventions from the RBA can greatly affect this pair. This is why you should pay particular attention to the economic and interest rate prospects of both Australia and New Zealand.

2. Weather, commodity yields, and travel

Since both the economies of Australia and New Zealand are commodity-based and New Zealand has a large tourism industry, AUDNZD is often sensitive to New Zealand's weather, cargo volumes, and tourism outlooks.

For example, bad weather in Australia or New Zealand tends to lead to a sell-off of the currency of the affected country. Again, you should stay up to date with reports on yields, metal prices, crops, harvests, and tourism growth.

3. Relations with Asia

Over the years, both New Zealand and Australia have been the supplier of raw materials to Asian countries including China, India, and Japan. This means that the value of AUDNZD is tied to the need for resources from Asia. Remember the economic feature, is “Australia is a major exporter of metals and energy products while New Zealand is one of the exporters of milk and meat. and wool ”. Therefore, when demand for iron ore or copper increases, the AUD will outperform the NZD, and when demand for agricultural products increases, the NZD will outperform. These days, iron ore prices have consistently peaked, making the AUD soaring is a testament

IS AUDNZD A "TOXIC" RATE?

AUDNZD is not a toxic pair but a normal cross. This pair does not include the US dollar, but there are 2 main currencies in the G7 group (AUD, NZD, CAD, EUR, GBP, CHF, and JPY).

ADVANTAGES WHEN TRADING WITH AUDNZD
  1. AUDNZD has a number of features that will give you the edge in a competitive forex market.
  2. AUDNZD is generally not severely affected by global economic, political, and social topics. There are hardly any external events that can spoil the separate relationship between the two States. This means you can create a strategy based on powerful technical analysis.
  3. This pair trending on a regular basis and strongly. This makes trading relatively easier compared to other pairs like GBP / USD, which can take a long time to form a clear trend.
  4. While this is not one of the most volatile pairs on the Forex market, the AUDNZD provides enough volatility to make trading worthwhile.
  5. AUDNZD has the advantage of the time zone. Most currency pair news comes at the earliest of the trading day, so you can correct your position in the event of any unexpected event or unfavorable market movement. Early time zones often leave plenty of room for the market to self-adjust and go in a favorable direction.
AUDNZD CONSIDERATIONS
  1. While it offers some benefits, you still have to be wary when trading with AUDNZD as it has some downsides.
  2. Although AUDNZD is primarily risking neutral, it is still seen as a high liquidity pair that is less liquid than major forex pairs. Therefore, this pair will often have a larger spread. This can be especially challenging for intraday traders who rely on low spreads.
  3. AUDNZD's lower liquidity can sometimes lead to delays in the collection of market prices and it often leads to slippage. This can cause a significant loss in trading.
  4. AUDNZD trading times may not be the most exciting. Most AUDNZD trading takes place during the Asian session. Meanwhile, this session is usually the quietest and slowest volatility in the forex market, making you feel bored at times. This leads to the important question, "What is the best time to trade AUDNZD?"
COMMON TRADING STRATEGIES FOR AUDNZD

You can trade AUDNZD using a variety of strategies. Top AUDNZD trading strategies include:

1. Trading according to the trend:

Trend trading is the use of technical indicators to determine the direction and momentum of the market, that is, to determine the market's uptrend and downside. AUDNZD is a good candidate for trend trading as it has a strong uptrend, with clear sideways periods



You can use moving averages to view the fundamental trend of a currency pair. For example, you can buy when the price falls, retest the moving average in an uptrend, and vice versa.


2. Swing Trading:

Trend trading is usually a long-term (several months) strategy. If you want a shorter-term strategy and hold positions for a few days to a few weeks, swing trading may be more suitable for you.


With swing trading, you define price ranges and then you buy at support and sell at resistance levels.

3. Position trading:

Position trading involves holding a trade for a long period, usually weeks to years, with the expectation that the value of the investment will increase. This strategy ignores short-term price movements in favor of longer-term trends and greater potential for returns.


Since AUDNZD tends to be very strong over relatively long periods of time, you can try to profit more from moves in the long term. However, you must remember that when trading on a long timeframe, increases the inherent risk of trading.

Note: It is easy to confuse trend trading with position trading, but they are different. The first tool mainly focuses on technical analysis while position trading mainly focuses on fundamental analysis.

TRADE ON THE AUD, NZD RATIOS WITH OTHER TYPES OR INDICATORS

This has been discussed in detail in the economic characteristics, the strategic commodity of 1 Country will increase that currency against the other! As the example below the price of Iron Ore was followed by a rebound in the AUDNZD cross!