After finding resistance at 1.0890 last week, AUD/NZD started to consolidation in a range between that high and a low near 1.07. The 1H chart shows that 1.0850 is a more common resistance, so even above 1.0850, we might anticipate a bullish extension above 1.0890.
We also see price in the middle of moving averages, which are now moving sideways. But the fact that AUD/NZD is still above the 200-hour SMA shows a slight bullish bias. Today, price found support around 1.0750, avoiding falling towards the 1.07 area. This could be a sign that bulls are ready to take off once AUD/NZD crosses above 1.08. From the range seen in the 1H chart, we can say that a break above 1.08 puts pressure on 1.0890-1.09 area with risk of extending higher in-line with the prevailing uptrend. A break below 1.07 would open up a bearish correction limited because of the prevailing uptrend.
The 4H chart shows that indeed AUD/NZD has a prevailing uptrend, at least from the 1.0035 low. Also, we can see that a break below 1.07 is not necessarily a signal for a reversal, especially if price is still above a rising trendline. But even below the rising trendline, if AUD/NZD can hold above the 1.0520-1.0550 support/resistance pivot area, it should remain bullish, or at least NOT bearish. Below 1.05 however would then open up the 1.03 handle. IF price can stay above the 1.03 handle, AUD/NZD can still be bullish-neutral, but below 1.03 the pair would likely have been in bearish continuation.
The daily chart shows the sharp rally since April’s and the year’s lows. I would lean on the bullish outlook not only because of the strong technicals, but also because the RBA is likely done with rate cuts while the RBNZ is still expected to cut rates this year.
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