Technical Sentiment: Bullish
Key Takeaways
Recent events sparked sufficient buying interest for AUD/NZD, triggering a bullish break-out outside the boundaries set by its recent 6-day range.
Technical Analysis
AUD/NZD has been stuck in a relatively tight range since last week of August, after two consecutive failures to rally above 1.1190 yearly pivot line. On Monday traders were focusing more on the support area, priced at 1.1125 near the 50 Simple Moving Average on 4H timeframe, when NZD was sold-off across the board after as Global Diary Trade Price Index fell 6%. During the Asian session, AUD/NZD rallied above 1.1200 in the early hours of the European Session, confirming market intentions to seek a Higher High in the coming days.
Stochastic shows overbought conditions on both 4H and Daily; however this is neither new information or relevant while price action lacks bearish signals. On 4H, MACD shows a negative divergence compared with the pair’s Higher Highs, possibly warning that this is the last bullish wave before a deeper correction takes place.
Free Reports:
With AUD/NZD currently trading above 1.1210, buyers are eyeing the next areas of interest, starting with 1.1300 (1-year old price pivot zone), with a potential extension up to 1.1430/35 if fundamentals allow it.
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Prepared by Alex Z., Chief Currency Strategist at Capital Trust Markets
