Are the tides changing for AUD/NZD? In case you missed it, just last week AUD/NZD’s 100 SMA has crossed ABOVE the 200 SMA for the first time since late September. However, the pair had also found resistance at the 1.0900 area and is now back at the 1.0780 levels. In fact, the pair could drop by as much as another 100 pips to 1.0680 before it sees significant support. See, the area has not only been an area of interest in October, but is also lined up with a 50% Fib and 200 SMA on the 1-hour time frame. You can wait for the pair to see some support at the Fib levels before you pull the buy trigger but you can also sell at market prices and take profits at the support areas if you’re confident that the pair is gonna see some more losses before it bounces.
Thanks to last week’s moves, GBP/AUD had broken a rising channel pattern that had been holding since mid-October. What’s interesting to note is that the channel’s previous support is currently serving as resistance for the pair. Of course, it also doesn’t hurt that Stochastic is chillin’ like a villain on the overbought territory. A short at market prices with a stop above the SMAs could get you decent pips if you aim for the previous lows while a buy order with a stop below Friday’s lows is also a good idea if you think the pair isn’t done with its uptrend.
Last up for today is another support-turned-resistance scenario, this time on NZD/USD’s 4-hour chart. The pair had dropped below the .6500 area last Friday after the NFP report, but looks like it could be getting back up. The .6550 area could hinder the bulls from reclaiming the falling channel as it lines up with a previous support. Stochastic is spotting an oversold signal though, which could give the bulls some traction over the next couple of hours. What do you think? Will NZD/USD get back to the SMA and mid-channel areas or are the bulls done with their cause for now?
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To get the complete picture and avoid getting blindsided by economic data, you also have to do your fundamental analysis. Lucky for us, Pip Diddy fills us in on what we need to know about fundamentals with his Daily Forex Fundamentals.