Consolidation or Topping Pattern in AUD/NZD?

By DailyFx | August 15, 2014 AAA

DailyFX.com -

Talking Points

  • Cycles turning negative on cross
  • H&S pattern developing on the daily

Unfamiliar with Gann Square Root Relationships? Learn more about them HERE.

AUD/NZD has responded well of late to key cycle turning points. The low in mid-July, for instance, came almost exactly 8.6 years from the major low in 2005. We think there is a good chance that the turn will mark an important low. However, we do see some cyclical headwinds over the next few weeks which should see the cross come under a bit of pressure as it enters a corrective phase. The daily chart shows a potential head & shoulders pattern that if triggered on a move under 1.0920 will confirm that at least a minor top is in place. We like selling the cross on a break of 1.0920 for quick counter-trend trade. The 200-day moving average near 1.0835 and the 61.8% retracement of the July/August advance at 1.0785 are clear downside attractions.

To receive other reports from this author via e-mail, sign up to Kristian’s e-mail distribution list via this link.

AUD/NZD Daily Chart: August 15, 2014

Consolidation or Topping Pattern in AUD/NZD?

Charts Created using Marketscope – Prepared by Kristian Kerr

Key Event Risk in the Week Ahead:

Consolidation or Topping Pattern in AUD/NZD?

LEVELS TO WATCH

Resistance: 1.1000 (Psychological), 1.1052 (YTD high)

Support: 1.0925 (neckline), 1.0890 (Fibonacci)

Strategy: Sell AUD/NZD

Entry: Sell AUD/NZD on a break of 1.0920

Stop: 1-day close above 1.0950

Target: 1.0835

comments powered by Disqus
Related Forex Analysis
  1. NZDUSD Top Possibly in Place for Next Bear Leg
    Forex News

    NZDUSD Top Possibly in Place for Next Bear Leg

  2. EUR/USD calm near 1.2660
    Forex News

    EUR/USD calm near 1.2660

  3. EUR/USD seen at 1.25 by year-end - Commerzbank
    Forex News

    EUR/USD seen at 1.25 by year-end - Commerzbank

  4. GBP/USD technical are mixed - Scotiabank
    Forex News

    GBP/USD technical are mixed - Scotiabank

  5. Stop the press. Literally! - BAML
    Forex News

    Stop the press. Literally! - BAML

Trading Center