AUD/NZD Technical Analysis
During the Asian session the pair tested the price pivot zone at 1.0735 and the 50-Day Moving Average. Positive Australian Employment Change and Unemployment Rate were followed by a rally, keeping the uptrend configuration –higher lows- intact.
The pair topped around 1.0836, just a few pips above last week’s high. A daily close above 1.0815 would make today a Bullish Engulfing Bar and confirm the break of a year old trendline, with a follow-up above 1.0832 indicating the pair has a lot of traction in this area and will move higher in the coming days. Until then, however, the current double top should be treated carefully as it could lead AUD/NZD towards a range personality between the 1.0735 support and the current resistance.
All bullish scenarios are invalidated if AUD/NZD maintains the double top and later drops below 1.0735. This would lead to a test of the 1.0700 handle where the 100 and 200 Simple Moving Averages lie on the 4H timeframe, and even lower towards the 1.0640 support level.
Resistance levels: 1.0832; 1.0934/41; 1.1071.
Support levels: 1.0735; 1.0640; 1.0535.
NZD/JPY Technical Analysis
The pair maintains a bearish tendency after breaking below the up trending channel support earlier this week. While price action has been extremely choppy, NZD/JPY still respects technical levels as it went up to 89.18 during the Asian session, forming a lower high on the 61.8% Fibonacci Retracement from 89.89 down to 88.03.
Between 88.03 and 89.18 the pair will continue to be characterized by indecision, as it struggles between the 50 and 100 Simple Moving Averages on the 4H timeframe. The bearish tendency will be confirmed by breaking through the 88.00 handle, opening the way towards 87.34, the 200 Simple Moving Average on 4H. Since the support of the main channel between August 2013 – April 2014 is located around 84.14, bearish scenarios have a lot of potential if the technical landscape does not change.
Above 89.18 NZD/JPY will switch to a bullish bias and another run at the 90.00 handle will take place. 91.39 is the next resistance level above it, if the resistance of the channels will allow for this kind of rally.
Resistance levels: 89.18; 89.89; 90.00; 91.39.
Support levels: 88.03; 87.34; 86.64; 85.75.
*********
Prepared by Alexandru Z., Chief Currency Strategist at Capital Trust Markets
