I’m seeing this neat trend setup on AUD/NZD, and I think it may be a good time to go with the flow from here. Should I jump in at market?
Long AUD/NZD Idea
I’m gonna be honest with y’all… I spotted this setup on Forex Gump’s blog post and rushed to it like a pair of boots on sale!
And who wouldn’t? I mean, look at the solid ascending channel with support right in line with an area of interest and the 61.8% Fib. Price already seems to be bouncing off the channel support and might be ready to climb back to the top near the 1.1200 mark.
Stochastic is on the move up to confirm that buyers are in control of the game, but the oscillator is also nearing overbought conditions so another dip may be in order.
Both commodity currencies are enjoying strong support so far this week on news of the trade deal between the U.S. and Mexico. TBD if Canada will also be part of the cool kids, but it seems that these developments are enough to spur risk-taking.
Between the Aussie and the Kiwi, though, I’m still a tad bearish on the latter because of monetary policy differences. In the latest RBNZ statement, the central bank sounded more dovish than expected as they downgraded most economic estimates and pushed back rate hike forecasts.
Then again the Aussie might still be struggling with political uncertainty since their PM just stepped down last week and a new leadership is just warming up the seat.
With that, I’m looking to enter either on another dip to the channel bottom around 1.0925 or a pickup in bullish pressure past the 1.1000 level to jump in. I’m setting my stop below the swing low of 1.0840 and aiming for the swing high at 1.1175 as my target. What do you guys think?
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