The AUD/USD and NZD/USD are bearish but both found support last week and appears to be fighting back USD-strength as we enter this one.
The AUD/USD found support at 0.7616 last week and started to consolidate in a range between that low and the 0.7674 resistance. Note that the 0.7674 level was also a previous support pivot. The 1H RSI has held under 60, which shows that the prevailing bearish momentum is still in play. The bias and pressure is on the 0.7615 level, a break below which opens up another 60 pips lower (60 pips came from the width of the current range (0.7675-0.7615).
Now if price breaks above 0.7675, there should be a key resistance around the 0.77 handle. There is a falling trendline around this psychological level. A break above 0.77 would open up the 0.78 handle, with a bullish outlook that should be limited to the 0.7870-0.7880 area, which involves another previous support pivot and the 200- and 100-period simple moving averages (SMAs) in the 4H chart.
NZD/USD kept drifting at the end of last week and found support at 0.7066 to begin this one. Then after a brief rally, we saw a bearish engulfing candle from 0.7124. This is a bearish signal ,but if traders can push NZD/USD above the 0.7124 resistance where the engulfing candle began, then, we would have a bullish correction signal. You can see the market contemplating at the moment as price bounced off of 0.7095 to test the noted resistance again, where the 50-hour SM also resides now.
A failure to clear 0.7125 and a break below 0.7094 should put the pair in bearish continuation mode to pressure the 0.7066 low with risk of breaking to the 0.70 psychological level.
A break above 0.7125 should open up the 0.7194-0.7208 support resistance pivot.
In the 4H chart, we can see that a rally back towards the noted 0.72 target area would also test a falling trendline coming down from mid-May’s high at 0.7564.
Previous Post by Author: EUR/CAD – Kilroy Attempt #2