Technical Analysis – AUDNZD looks neutral-to-bearish in short-term; long uptrend in focus

Technical Analysis – AUDNZD looks neutral-to-bearish in short-term; long uptrend in focus

Technical Analysis – AUDNZD looks neutral-to-bearish in short-term; long uptrend in focus

Christina Parthenidou, XM Investment Research Desk

AUDNZD erased part of the August rebound after hitting a 10-month high of 1.0837, with the momentum indicators pointing now to a neutral-to-bearish short-term tendency. Τhe MACD keeps losing ground under its red signal line and the RSI has dropped marginally under its 50 neutral threshold and is flattening.

The bigger picture, on the other hand, provides some positive trend signals for thought, as the pair is pushing efforts to escape the downward pattern it started two years ago, printing higher highs above 1.0668 and higher lows above 1.0120.

A successful move under 1.0665 could meet the 38.2% Fibonacci of 1.0618 of the upleg from 1.0261 to 1.0837 ahead of the 50% Fibonacci of 1.0551. The sell-off could get more legs under the latter and the bottom of the Ichimoku cloud, in which case a closing price beneath the 200-day simple moving average (SMA) could bring another important barrier between the 61.8% Fibonacci of 1.0483 and the 1.0430 handle into view.

On the flip side, an upside reversal above April’s high of 1.0729 and more importantly beyond the 20-day SMA would keep hopes of an up-trending market alive, pushing resistance back to the 1.0800-1.0837 region. Further up, the rally may take a breather within the 1.0875-1.0930 area, as it did last year.

In short, AUDNZD could adopt a neutral-to-bearish behavior in the short-term, while in the bigger picture, hopes for an up-trending market would resume above 1.0729.


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