AUDUSD and NZDUSD vulnerable to further losses

Intermediate
  • As we highlighted in yesterdays’ report here the present “risk on” stage seen in the equity markets has also seen a strong US Dollar, with the US currency rallying across global major currencies (except the Japanese Yen).
  • This reflects strong US economic data, despite the continuing worries about a faltering global recovery.
  • We underlined this US$ strength in the last report by focusing on negative pressures for EURUSD.
  • But here we spotlight the weakness in AUDUSD and NZDUSD Forex rates, with the US currency strength reinforced by both the Reserve Bank of Australia (RBA) and Reserve Bank of New Zealand (RBNZ) shifting more dovish as their respective economies report worsening economic data, putting downside pressures on their respective currencies.

AUDUSD intermediate-term bear trend intact

A further push lower Thursday through key .6999 support and alos.6991, to reinforce Wednesday’s aggressive plunge, through multiple supports from .7104/00 to .7122 (after Australian CPI data), to keep risks lower for Friday.

The early February push .7073 set an intermediate-term bear trend.

For Today:                                                        

  • We see a downside bias for .6986; break here aims for .6949, maybe even .6916.
  • But above .7050 sees little resistance up towards .7103.

Intermediate-term Outlook – Downside Risks: We see a downside risk for .6916.

  • Lower targets would be .6829 and .6738
  • What Changes This? Above .7207 shifts the intermediate-term outlook straight to a bull theme.

4 Hour AUDUSD Chart

AUDUSD Chart

NZDUSD bear trend intact (despite a bounce)

A probe Thursday below a key, multi-month low at .6583, and despite a rebound after from .6578, whilst capped minimally below .6659 we still see negative forces from the recent selloff through supports and the prior April surrender of the key .6716 level, leaving the bias lower Friday.

The April push below .6716 set an intermediate-term bear theme.

For Today:

  • We see a downside bias for .6603 and .6578; break here aims for .6542.
  • But above .6659 opens risk up to .6679/82

Intermediate-term Outlook – Downside Risks: We see a downside risk for .6583.

  • Lower targets would be .6347 and .6195
  • What Changes This? Above .6837 shifts the outlook back to neutral; above .6938 is needed for a bull theme.

4 Hour NZDUSD Chart

NZDUSD Chart

Editor in chief

Steve Miley has 29 years of financial market experience and as a seasoned expert now has many responsibilities. He is the founder, Director and Primary Analyst at The Market Chartist, the Editor-in...continued

Comments on this analysis

Your email address will not be published. Required fields are marked *


Latest Related News

NZDUSD monthly trend line retest

The price broke the massive monthly trend line during sell off in March and now we see a retest of that trend line at a strong resistance zone at 0.62. New Zealand was highly effective in its response the pandemic and a pullback of the stock market created a risk on environment for the currency to bounce back. The FED printed trillions of dollars and… Continued

US Dollar weakens across the Forex board

US Dollar Index breaks key support (DXY forecast)Euro-Dollar breaks up (EURUSD forecast)Aussie-Dollar major resistance weakens (AUDUSD forecast) Continued

A “wait and see” phase: Resilient, but cautious

Macroeconomic/ geopolitical developments A potential COVID-19 vaccine from Moderna that had seen positive results in human trails sent global stock markets notably higher to start the week. Despite the positivity regarding the vaccine being dented by a report from the STAT medical media company, risk assets and currencies maintained their firm footing at the start of the week.This positive “risk on” theme was further reinforced… Continued

Risk on bias leaves AUDUSD pointing higher (AUDUSD Forecast)

A shift back towards a “risk on” theme this week, with stock indices rebounding after a lack of escalation after negative comments from the end of last week US government officials regarding China and potential tariffs.In the Forex space, this has seen the “risk” currencies rallying, with the Australian, New Zealand and Canadian Dollars all higher against the US Dollar after early losses at the… Continued

Mixed signals from Forex pairs

US Dollar approaches major support (DXY)Big negative on Aussie (AUDUSD)Euro-Aussie reverses  (EURAUD) Continued

Forex Brokers in your location