Forex Video Briefing (7/17) – AUD/USD, NZD/USD, Gold (XAU/USD)


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Forex Video Briefing (7/17) – AUD/USD, NZD/USD, Gold (XAU/USD)

In the 4H AUD/USD chart, you can see that the market has formed a head and shoulders pattern. The main thing to note is that there was an exhausting push to 0.95, which was rejected. Now price is respecting the highs around 0.9440, showing by a clear-out of that level last week. The clear-out suggests a bearish outlook, and one has formed so far. As price starts to trade below moving averages, the prospect of a bearish outlook grows, especially if price falls below the neckline near 0.9320. Although this might not reverse the uptrend in 2014 which started late January, there would be some short-term bearish bias, towards the 0.92-0.9210 support area seen in May and June.

The NZD/USD has been very bullish in 2014, but has been falling in July after a new high on the year at 0.8835. The current slide is attributed by many to a slide in dairy prices. We did see a similar dip in dairy prices in April. The NZD/USD followed that with a consolidation but eventually continued the uptrend. So, we can have a similar anticipation of bearish correction/consolidation in the rest of July and maybe August, but when price nears the 0.86 level, we should consider looking for support from the rising 2014-trendline. A break below the trendline could put the focus on the 0.85-0.8520 lows, and can shift the bullish market into a sideways one.

Gold prices slid about 4% since the 1345 high last week, down to a 1292.20 low this week. The slide engulfed the previous consolidation area, which suggests that the previous bullish breakout was exhaustion. This in turn signals a bearish outlook. We are getting a pullback today, but if price approaches the 1325-30 area, look for resistance especially when the RSI approaches 60. If price does stall around 1325, and the RSI does stall around 60, look for a bearish attempt toward teh 1292.20 low. There could be further downside risk toward the 1270 area, which is around some common lows in April and May. A dip to this area would still be within the consolidation mode of 2014. However If price breaks above 1335, the short-term bearish correction outlook is going to be shelved,