AUDNZD turned sharply down in the last quarter of 2022, signaling the end of a higher-degree bullish structure. We discussed this back in 2022 and warned about a bearish turning point, which should resume even lower as the pair shows an impulsive drop for wave (A) on the daily chart. However, nothing moves in a straight line, so the current sideways price action through most of 2023 and 2024 is most likely still wave (B) correction that can send prices lower within wave (C) later this year, ideally after an A-B-C rise up to the 1,11-1,12 resistance area, which can come into play soon as Australian inflation recently came in hot, and we also got the latest retail sales figures from Australia coming out higher than expected. Therefore, there is potential that the RBA should stay hawkish, which can keep the Aussie in an uptrend, not only against the New Zealand dollar but possibly also against the US dollar.
AUD/NZD daily chart
In fact, we also discussed bullish Aussie prospects in our webinar on Monday, where we showed you a bullish triangle on AUDUSD pair. A potential breakout of this bullish contracting range can also be positive for AUDNZD, especially if the breakout is driven by Aussie strength rather than dollar bearish flows. If we are correct, then the current black wave B on AUDNZD can be finished as a triangle, potentially sending the price towards the 61.8% to 78.6% Fibonacci retracement level, where we should be aware of potential limited upside based on Elliott Wave rules and guidelines.
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