7 Nov 2013
Flash: AUD/NZD long position closed, pattern fails - ANZ
FXstreet.com (Barcelona) - The potential for a stronger recovery in AUD/NZD has been undermined by the rotation lower which broke and close below 1.1390, notes Tim Riddell, Head of Global Markets Research at ANZ.
Key Quotes
"The rollover in daily momentum indicators could have indicated a pause in the potential series of upside retracements, but the close below 1.1390 has undermined the perceived technical structure. This has therefore triggered a closing of the long AUD/NZD recommendation on 23 October (long at 1.1465, target of 1.1750 and stop at 1.1390)."
"Upside potential has been undermined, but this does not necessarily involve a return to the preceding downtrend in AUD/NZD. The 1.1150-1.1200 lows could still provide the base for a broader correction, but the recent pullback suggests that the consolidation is more likely to develop via time rather than price. That implies that AUD/NZD may form a tighter, overlapping and frustrating range play rather than a more dynamic retracement."
"Critical in the near term will be that AUD/NZD remains above the next pivot point of 1.1295, but a close above 1.1420 is needed to provide the impetus for another attempt, even if overlapping, to push to the upside."
Key Quotes
"The rollover in daily momentum indicators could have indicated a pause in the potential series of upside retracements, but the close below 1.1390 has undermined the perceived technical structure. This has therefore triggered a closing of the long AUD/NZD recommendation on 23 October (long at 1.1465, target of 1.1750 and stop at 1.1390)."
"Upside potential has been undermined, but this does not necessarily involve a return to the preceding downtrend in AUD/NZD. The 1.1150-1.1200 lows could still provide the base for a broader correction, but the recent pullback suggests that the consolidation is more likely to develop via time rather than price. That implies that AUD/NZD may form a tighter, overlapping and frustrating range play rather than a more dynamic retracement."
"Critical in the near term will be that AUD/NZD remains above the next pivot point of 1.1295, but a close above 1.1420 is needed to provide the impetus for another attempt, even if overlapping, to push to the upside."