- AUD/NZD corrects lower from 1 1/2 year highs at 1.1289 (Oct 24 high), slips below 1.12 handle.
- The pair 0.11% down on the day, hovers around 1.1175 levels, bias lower.
- Price action has slipped below 5-DMA support at 1.1198 which is now capping upside.
- We evidence a potential 'Bullish Cypher' pattern on the daily charts which raises scope for downside.
- We also note bearish divergence on RSI and Stochs which adds to bearish bias. RSI and Stochs have also rolled over from overbought levels.
- Aussie also weak following downbeat inflation and PPI data which cement RBA's neutral stance.
- 1.1072 (23.6% Fib retracement of 1.0370 to 1.1290 rally) is immediate support, while 1.30 is major resistance.
Support levels - 1.1072 (23.6% Fib retracement of 1.0370 to 1.1290 rally), 1.1043 (20-DMA), 1.1002 (50-DMA)
Resistance levels - 1.1199 (5-DMA), 1.1290 (Oct 24 high), 1.30 (trendline)
Recommendation: Good to go short on rallies around 1.1180/90, SL: 1.30, TP: 1.11/ 1.1070/ 1.1045
FxWirePro Currency Strength Index: FxWirePro's Hourly AUD Spot Index was at -86.7433 (Bearish), while Hourly NZD Spot Index was at -46.7754 (Neutral) at 0700 GMT. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex.
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