AUDNZD Set To Rally (D)
Created on Monday, 13 June 2016 08:57
Written by Austin Galt
The AUDNZD currency pair has traded down recently and right now looks to represent a good buying opportunity. Let’s review the technicals of the daily chart.
AUDNZD DAILY CHART
Since previous analysis price has traded down which was expected although the potential for one last high was offered but a lower high only was given.
Previously, I outlined the potential for a 5 point broadening top to form with the August 2015 high at 1.1616 the point 4 high. While this is certainly still possible I am now favouring that to be a higher high only with the focus now on a higher low instead of a new low being the point 5 low.
I have added Fibonacci retracement levels of the move up from low to higher high. The first correction in a new bull trend often makes a deep retracement and price looks to have pulled up a whisker above the 76.4% level. I believe this low at 1.0404 may well represent the major higher low with price set to rally from here.
I have drawn a Fibonacci Fan from the higher high to first subsequent low. It shows the recent high tickling the upside of the 88.6% angle and price is now back nudging support from the 76.4% angle. I favour the uptrend to resumes from here which will eventually see price bust well above the 88.6% angle.
I have added moving averages with time periods of 100 (red) and 200 (black) and these are back in bullish formation with the red line above the black line.
The RSI shows a triple bullish divergence at this low which often leads to a significant price rise.
The MACD indicator is still bearish but is also showing multiple bullish divergences at this low.
So, I am now bullish the AUDNZD although that might change should price bust the 1.0350 region. I will review the longer term charts in the next monthly newsletter.