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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