It’s the final Chart of The Day for the week, and with this one, we’re focussed on the Australasia region looking at AUDNZD on the 4hr time frame. Despite the longer-term indicators appearing bullish, some of the shorter ones tell a different story.
I’ve chosen an Ichimoku chart for this as it provides a clearer view in my opinion of precisely what is happening with the Aussie Kiwi cross during this period.
Since early July, the price broke above the cloud, and consistency pushed to higher levels as demand for the Aussie increased sharply. On the daily time frame, you can see this bullish trend remains in-play, but on this 4hr time-frame, we are beginning to see signs of this bullish rally breaking down. Note how both the longer-term lagging span (purple line) has now dipped below the cloud along with price action in general.
The recent activity suggests either the start of a short-term corrective move or perhaps a weakening of the Australian Dollar in general. Should the price continue to fall, the level of 1.0700 seems to suggest a possible downside target with plenty of support within this area.
Alternatively, 1.10 will be the region that buyers may continue to see strong resistance to the upside as recently shown, which also tends to happen when the price approaches round numbers such as this.
To catch up on the previous Chart of The Day mentions this week, links will be provided below.
By Adam Taylor CTEe
Sources: Go Markets, Meta Trader 5, TradingView, Bloomberg
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