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AUDNZD Scalps Target Near-term Support Bounce- Bullish Above 1.1320

AUDNZD Scalps Target Near-term Support Bounce- Bullish Above 1.1320

Michael Boutros, Strategist

Talking Points

  • AUDNZD reversal off October highs halts at Fibonacci / Trendline support
  • Risk of near-term bounce shifts focus higher into close of the week
  • Bullish invalidation with break / close below 1.1320

AUDNZD Daily Chart

Forex_AUDNZD_Scalps_Target_Near-term_Support_Bounce-_Bullish_Above_1.1320_body_AUDNZD_Daily.png, AUDNZD Scalps Target Near-term Support Bounce- Bullish Above 1.1320

Chart Created Using FXCM Marketscope 2.0

Technical Outlook

  • AUDNZD decline off October highs completes two equal legs down
  • Support at former trendline resistance / 100% extension 1.1320 (today’s low 1.1324)
  • Daily RSI trigger-break lacks conviction / Risk for topside correction near-term
  • Topside resistance objectives at 1.1405, 1.1438 & monthly high at 1.1490
  • Support break targets 1.1290 and key support at 1.1197- 1.1216
  • Key Events Ahead: Australian Employment Report on Thursday, China Industrial Production & Retail Sales data this weekend

AUDNZD Scalp Chart

Forex_AUDNZD_Scalps_Target_Near-term_Support_Bounce-_Bullish_Above_1.1320_body_AUDNZD_SCALP.png, AUDNZD Scalps Target Near-term Support Bounce- Bullish Above 1.1320

Notes: Although the decline off the October highs has been rather sharp, the pair has now come into a key support zone between 1.1320- 1.1352 that may offer a near-term bounce. The support structure is defined by the 61.8% retracement of the rally off the September low, the 100% Fibonacci extension taken from the decline from last month’s high and former trendline resistance dating back to the June 2013 high. As such, our focus has immediately shifted to the topside against this support region with only a break/close below invalidating our near-term scalp bias.

A long intra-day RSI trigger was identified just ahead of the European open with a break and re-test of trendline resistance warranting near-term long exposure. Look for a breach above former channel support to offer further conviction with such a scenario eyeing subsequent resistance targets. Note that near-term RSI support warrens of a possible pullback with another test of the 100% extension at 1.1320 not off the table before mounting a more meaningful rally. We will attempt to buy on dips / breaks of resistance so long as the pair remains above 1.1320 with a breach of the November opening range high at 1.1490 suggesting that a more significant low may be in place heading into the end of the month.

* It’s extremely important to give added consideration regarding the timing of intra-day scalps with the opening ranges on a session & hourly basis offering further clarity on intra-day biases.

Key Threshold Grid

Entry/Exit Targets




Resistance Target 1

Daily / 30min


618% Retrace & 78.6% Fib Extension

Resistance Target 2

Daily / 30min


61.8% Fib Extension

Bearish Invalidation



Weekly Opening Range Low / 50% Ext

Break Target 1

Daily / 30min


38.2% Retracement / 61.8% Ext

Break Target 2



Soft Resistance / Pivot

Break Target 3

Daily / 30min


61.8% & 23.6% Retrace(s) / Nov Open High

Break Target 4



78.6% Retracement / Pivot

Break Target 5

Daily / 30min


78.6% Retrace / 78.6% Fib Ext

Bullish Invalidation

Daily / 30min


100% Fib Ext / Current Nov Low / TL

Break Target 1

Daily / 30min


78.6% Retracement

Break Target 2



88.6% Retracement

Break Target 3

Daily / 30min

1.1197 – 1.1216

1.618% Ext / Sept Low / 2013 Low

Break Target 4

Daily / 30min


Channel Support Dating 2011 / Pivot

Average True Range



Profit Targets 18-20pips

Other Setups in Play:

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---Written by Michael Boutros, Currency Strategist with DailyFX

For updates on this scalp and more setups follow him on Twitter @MBForex

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