AUD/USD and NZD/USD In Bearish Continuation Mode

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AUD/USD and NZD/USD In Bearish Continuation Mode

This week, we had some big shakeups in the forex markets. For the AUD/USD and NZD/USD, the main factor was the FOMC’s announcement to end QE, which revived USD-strength and put the comm dolls in a bearish continuation mode. Let’s take a look at the charts.

The AUD/USD has been consolidating in October. The reaction to the FOMC announcement provided a bearish engulfing candle in the daily chart. This bearish signal is sticking and AUD/USD is poised to test the low on the year at 0.8642. Below that there is a support pivot at 0.8577. We should look for buyers in the 0.85-0.8577 area as the daily RSI also dips back into oversold levels. The NZD/USD is in a similar set up, with the prevailing downtrend and momentum intact in the daily chart. It also showed a bearish engulfing candle after the FOMC’s announcement. The NZD/USD looks poised to test the 0.77-0.7710 lows on the year. There is a 2013-low at 0.7683. Below that, the 0.7450-0.75, 2012-lows will come in play as support.

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Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at forexminute.com.