AUDNZD Analysis September 2016 (W)
Created on Thursday, 01 September 2016 02:16
Written by Austin Galt
I’m starting to look closely again at the AUDNZD currency pair with a view to going long. Let’s see where things stand with the weekly chart.
AUDNZD WEEKLY CHART
Previous analysis has outlined the potential for a 5 point broadening low to form with price now on its way to new lows and the final point 5 low. However, I still rate a good chance that this pattern will be nullified with a higher low only.
I have added Fibonacci retracement levels of the move from low to high. The first correction in a new bull trend is often deep and that is certainly the case here with price already below the 76.4% level. The next level is the 88.6% level at $1.0201. I suspect a higher low may form just above that level so this is clearly now one to watch.
I have drawn a bullish and bearish Fibonacci Fan. Let’s run through them.
The bullish fan shows price recently rejected at resistance from the 61.8% angle and now breaking support from the 76.4% angle. The next area of support is the 88.6% angle which lies just below and that is where I will be looking for a higher low to form.
The bearish fan shows price trading down between the 76.4% and 88.6% angles which have provided support and resistance respectively. If I am wrong about a higher low then price is likely headed back to support from the 76.4% angle. If I am right about a higher low then that should occur soon and then price will head back and eventually overcome resistance from the 88.6% angle.
The Bollinger Bands show price headed back to the lower band.
The RSI looks like it will set up a bullish divergence at the next price low as will the MACD indicator.
Summing up, there is the potential for a major higher low to form shortly which would lead to a substantial move higher.