AUDUSD and NZDUSD on Cusp of Breaking Above Key Levels, Lines
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AUD/USD trend-line from January under attack
While trends in FX this year haven’t been the easiest to come by for the most part, AUD/USD has been the exception. Since January the persistent downtrend has been marked by an orderly sequence of lower lows and lower highs, and a trend-line to connect several of those peaks.
Trend-lines and trends don’t last forever. While this might not turn out to be a total trend turnaround, a sizable correction looks to be in order. Today, AUD/USD is on the verge of crossing the trend-line from January, and should it do so in convincing fashion look for a broader move higher to develop. The first area of resistance doesn’t arrive up until over 7300.
One could take the entry on a solid daily breakout (on a closing basis) above the trend-line, or wait for the first pullback or consolidation before taking entry. If holding for several days or longer isn’t your forte, then the daily break can be used on short-term time-frames (i.e. 4-hr, 1-hr) to shape a trading bias based on the broader path of least resistance.
For another view, check out our Chief Strategist John Kicklighter’s perspective on AUD/USD.
AUD/USD Daily Chart (Trend-line on verge of breaking)
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NZD/USD rounding its way higher out of bottom pattern
Kiwi is on the verge of breaking higher out of an inverse head-and-shoulders pattern, with the trend-line from June also aligning with the neckline of the formation. If today’s strong rally holds, then the daily close will constitute an official break. There is trend-line resistance from August to watch soon, but the depth of the pattern points to a move to around 6800. There may be some opposition around 6700, first, before running there.
NZD/USD Daily Chart (Breaking neck-line, t-line)
***Updates will be provided on these ideas and others in the trading/technical outlook webinars held on Tuesday and Friday. If you are looking for ideas and feedback on how to improve your overall approach to trading, join me on Thursday’s for the Becoming a Better Trader webinar series.
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---Written by Paul Robinson, Market Analyst
You can follow Paul on Twitter at @PaulRobinsonFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.