AUD/NZD: Levels, Ranges, Targets

AUD/NZD at 1.0400’s in February was an extraordinarily low price therefore a bolt higher was inevitable. Part of the reason why higher is AUD/NZD was located at bottom of a wide range from current 1.0400’s to 1.1500. Current price at 1.0900’s is now fairly mid range between both range points. What explains higher for this week was partly AUD/USD but especially a severely oversold NZD/USD from 0.6800’s. The oversold pressures in NZD/USD is now relieved as resistance lies from 0.7013 to 0.7069 and 0.7099. Likewise for AUD/USD as 0.7795 threatens AUD lower.
What drives AUD/NZD is exclusively NZD. If not for NZD, AUD/NZD would trade from 1.0833 to 1.0888 and threaten the bottom break points at 1.0700’s. The current break points are located in a 133 pip range from 1.1058 to 1.0925. The point 1.1058 is met however with thick and many resistance points from 1.1004, 1.1019, then 1.1031 to 1.1058. Further, an 1100 day average exist at 1.1042 as well as severe overbought at averages 100 day, 200 and 253.
While 1.0925 is the break point, AUD/NZD needs desperately a break at 1.0906 and 1.0903 to see 1.0888, 1.0859 and 1.0833. Then comes 1.0784 and 1.0691. Why 1.0903 is vital is because its a range break. What a 1.0903 break means in the larger picture is massive supports exist at 1.0767, 1.0713 and 1.0710. Should AUD/NZD break 1.0713 and 1.0710 then it travels far far lower.
As a strategy, I wouldn’t consider longs in AUD/NZD particularly when longs in either AUD/USD or NZD/USD is not favored. Longs for AUD/NZD, AUD/USD and NZD/USD would consider only upon far lower prices.

 

Brian Twomey

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