Can you believe it’s already the middle of the week?
We’re all about the Kiwi today as we explore potential resistance zones on EUR/NZD and AUD/NZD’s charts.
Don’t even think of missing these setups!
EUR/NZD: 1-hour
Just last week we played around with EUR/NZD’s range as it hit the 1.6100 support on the 4-hour time frame.
Did ya take the trade? If you did, then you would’ve made easy pips from the move up to the resistance!
I zoomed in a little today because there’s a bearish divergence on the 1-hour time frame just as EUR/NZD hit the 1.6300 resistance that we’ve marked.
Think this means that the range would hold for another day? Euro bears can short at current levels and aim for the 1.6100 support. More conservative traders can jump in as soon as there’s momentum and then bail at the first signs that momentum is petering out.
If you’re a fan of the current upswing, though, or if you believe that the euro has room to gain against the Kiwi, then you can set orders above the 1.6300 resistance and play a possible upside breakout.
Just make sure that you’re trading a breakout and not a fakeout!
AUD/NZD: 4-hour
Here’s one for the trend warriors out there!
AUD/NZD is flirting with the 200 SMA on the 4-hour time frame, which is interesting enough before we even note that its current prices also line up with a descending channel resistance that hasn’t been broken since the start of the month.
Will the Aussie extend its losses against the Kiwi? Or are Aussie bulls and Kiwi bears ready to see a breakout?
Candlestick pattern analysis tells us that there’s still demand from the bulls, so waiting for bearish candles or at least some momentum might be better if you’re shorting the Aussie.
The 1.0380 mid-channel support is a good initial target but you can also aim for last week’s lows if you see enough momentum.
If you’d rather trade a possible upside breakout, then you’ll want to watch how AUD/NZD reacts to the 200 SMA. Consistent trading above 1.0450 can lead to a retest of the 1.0525 levels or even October’s highs near 1.0600!
