The Australian and New Zealand Dollars have seem modest rebounds through the end of May and into early June versus the US$, which have eased immediate risks of more negative activity.
However, we still see AUDUSD in a bear trend and look for a resumption of downside pressures into early June. In addition, although NZDUSD remains in a range environment, the threat remains for an eventual bear break, below .6664.
Another rebound Wednesday to better probe up through .7260 resistance but again to stall at the .7298 resistance.
With the rebound effort losing momentum, this leaves the bias back lower Thursday.
For Thursday/ Friday:
- We see a downside bias for .7183 and .7147/41; break here aims for key support at .7106, then .7066/60
- But above .7298 aims for .7366/76.
The early May break below key .7411 signalled an intermediate-term bearish shift.
Short/ Intermediate-term Outlook – Downside Risks:
- We see a negative tone with the bearish threat to .7106.
- Below here targets .7000, .6971, maybe .6825.
What Changes This? Above .7719 signals a neutral tone, only shifting positive above .7835.
Daily AUDUSD Chart
A far firmer bounce Wednesday, rally this week from just above our key .6664 support level, to push above resistance at .6773/76 and .6801/07, to neutralize immediate downside risks and leave a consolidation theme into Thursday.
However, the Double Top pattern below .6805 leaves strong risk for an intermediate-term shift to bearish below .6664.
For Thursday/ Friday: We see a neutral tone between .6769 and .6843/48.
- Break above .6843/48 aims for .6881, which we would look to try to cap.
- Break below .6769 aims for .6704, which we would look to try to hold.
Short/ Intermediate-term Range Parameters: We see the range defined by .7054 and .6664.
Range Breakout Challenge
- Upside: Above .7054 aims higher for .7232 and .7396/7413.
- Downside: Below .6664 sees risk lower for .6572/41, .6418 and .6343.
Daily NZDUSD Chart