Nomura Research maintains a short AUDNZD position targeting a move towards 1.18.

"The AUD outlook appears very mixed in our view. Our RBA view (no further hikes) is somewhat more dovish than current market pricing, and rate spreads do not appear supportive, noting that markets moved this week to price a little more hiking in the US. Positioning data also suggest a balance of long positions, which may be becoming increasingly stale, in our view," Nomura notes.

"Against this, market sentiment appears to rising – with US equities and copper prices making fresh highs this week. Elsewhere, a somewhat firmer USD appears as another headwind, though CNY held up reasonably well last week. We remain a little more positive on NZD, based largely on rate spreads and positioning, and we continue to hold a short AUD/NZD position, albeit with modest conviction (3/5)," Nomura adds.