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AUDUSD and NZDUSD Downside Correction Threats

audusd chart

  • Late February has seen a resurgence on US Dollar strengthening as US Treasury yields move higher and with a growing anticipation of inflationary pressure and a possibly more hawkish FOMC.
  • This has seen AUDUSD sell off through modest range supports and although the intermediate-term theme is for broader range, the asymmetrical threat is to the downside (the key level us .77 56).
  • For the NZDUSD currency rate, the intermediate-term outlook remains bullish whilst above .7175, the immediate risks for late February are for a correction lower and possibly for a challenge to this level.

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AUDUSD Downside bias

A more significant  setback on Wednesday-Thursday through supports at .7877 and .7801, to ease the positive tone from last week’s move to another new rebound high (and rally through key .7960 resistance), to keep a negative bias into Thursday.

The mid-February push above .7960 neutralised the intermediate-term bear view, to switch the outlook to an intermediate-term range theme (range seen as .7756 to .8046).

For Today:

  • We see a downside bias for .7794; break here aims for 7771, maybe towards key 7756, which we would look to try to hold.
  • But above .7879 opens risk up to .7902, maybe .7951.

Intermediate-term Range Breakout Parameters: .7756 to .8046.

  • Upside Risks: Above .8046 sets a bull trend to aim for .8136, 8295 and the .8452/76 area.
  • Downside Risks: Below .7756 sees a bear trend shift to target .7635 and .7500.

Resistance and Support:

.7879 .7902 .7951 .7989* .8015*
.7794 .7771** .7756*** .7710* .7651*

4 Hour AUDUSD Chart

audusd chart

NZDUSD Correction risk lower

Another dip lower Wednesday-Thursday, through our initial support level at .7343/41 and also .7323, easing  the positive tone from last Friday’s push to match the cycle high from January at .7437, shifting the bias lower into Thursday.

The mid-February surge through .7420 produced a shift to an intermediate-term bull theme into at least the second half of February.

For Today:

  • We see a downside bias for .7305; break here aims for .7264 and maybe towards the .7238/30 area, which we would look to try to hold.
  • But above .7351 opens risk up to .7386, which we would look to try to cap.

Intermediate-term Outlook – Upside Risks:

  • Whilst above .7175, we see a positive tone with the bullish threat up to .7558 and .7744.

What Changes This? Below .7175 signals a neutral tone, quickly shifting negative below .7138.

Resistance and Support:

.7351 .7386* .7411 .7437** .7455
.7305* .7264 .7238/30** .7175** .7138***

4 Hour NZDUSD Chart

 nzdusd

Risk Statement: Trading Foreign Exchange on margin carries a high level of risk and may not be suitable for all investors. The possibility exists that you could lose more than your initial deposit. The high degree of leverage can work against you as well as for you.


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