AUD/USD Consolidates while NZD/USD Attempts Bullish Correction

AUD/USD Consolidates while NZD/USD Attempts Bullish Correction

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.

AUD/USD 1H Chart 6/1
audusd 1h chart 6/1
(click to enlarge)

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).

AUD/USD 4H Chart 6/1
audusd 4h chart 6/1
(click to enlarge)

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 1H Chart 6/1
nzdusd 1h chart 6/1
(click to enlarge)

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.

NZD/USD 4H Chart 6/1
nzdusd 4h chart 6/1
(click to enlarge)

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.

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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