AUD/NZD traded lower yesterday, after it hit resistance at 1.0612. That said, the pullback stayed short-lived near the 1.0565 level. Overall, the price structure remains of higher highs and higher lows above the upside support line taken from the low of September 23rd, and thus, we will consider the short-term outlook to be positive.
If the bulls are strong enough to jump back into the action from above the upside line, we would expect them to target again the 1.0612 barrier and if they are willing to overcome it, we could see them climbing towards the 1.0660 zone, marked by the high of July 15th. Another break, above 1.0660, could extend the trend towards the 1.0695 zone, marked by the inside swing low of July 12th.
Shifting attention to our short-term oscillators, we see that the RSI fell below its 70 line yesterday, but, today, it ticked up from slightly above 50. The MACD lies within its positive territory, but below its trigger line. Both indicators detect slowing upside speed, but the fact that the RSI turned up again suggests that the rate may start gaining momentum again soon.
In order to start examining whether the short-term outlook has changed to negative, we would like to see a clear dip below 1.0525. This could confirm the break below the aforementioned upside line and could pave the way towards the 1.0487 zone, which provided resistance September 30th and October 4th. If the slide does not end there, then we could experience extensions towards the 1.0433/40 zone, marked by the lows of October 5th and 6th.
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