By Orbex
AUDUSD breaks lower
The Australian dollar softened after a dovish RBA stressed that inflation was still too low to hike soon.
The pair has met stiff selling pressure near last July’s high of 0.7550. While sentiment has turned positive from the daily chart’s perspective, an overbought RSI has made buyers cautious.
The drop below 0.7490 then 0.7450 has forced out leveraged positions, exacerbating the downward pressure. 0.7380 on the 30-day moving average would be the next support. An oversold RSI may attract bids in this congestion area.
NZDUSD retreats from double top
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The New Zealand dollar bounced back after the Q3 unemployment rate fell to 3.4%.
A double top at 0.7220 suggests exhaustion in the kiwi’s ascent after the RSI repeatedly pointed to an overbought situation. A break below 0.7130 indicates that the bears have gained the upper hand, pushing the opposing side to close their bets.
The previous supply zone around 0.7070 has turned into a demand zone. This coincides with the 30-day moving average, and along with an oversold RSI, it may gain support from a buy-the-dips crowd.
UK 100 tests demand zone
The FTSE 100 consolidates gains as investors turn their attention to the US Federal Reserve meeting.
The bulls are looking to get a foothold after a close above the August peak at 7240. The RSI’s double top in the overbought zone is a sign of overextension in the short term.
Trend followers may look to stake in at the psychological level of 7200, a key demand zone on the 20-day moving average. A bearish breakout would deepen the pullback to 7140. On the upside, a rebound above 7310 would resume the rally.
Article by Orbex
Orbex is a fully licensed broker that was established in 2011. Founded with a mission to serve its traders responsibly and provides traders with access to the world’s largest and most liquid financial markets. www.orbex.com
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