January 13, 2022

EUR/NZD and GBP/AUD Aiming for Support?

 These two currency pairs just bounced off resistance levels and might be setting their sights lower.


Can you still catch some bearish momentum?


EUR/NZD: 4-hour

Is that a double top breakdown I’m seeing around the range resistance?


It looks like EUR/NZD sellers are just getting started and might have plenty of room to take the pair south.

The SMAs are in agreement since a bearish moving average crossover just took place, confirming that selling pressure is picking up. If so, price could head all the way down to the range support around the 1.6550 minor psychological mark.


I’d still be careful when shorting this one, though! Stochastic might be moving south, but the oscillator is closing in on the oversold region to reflect exhaustion among sellers.


Turning back up would suggest that buyers are putting up a fight, possibly allowing the area of interest at the middle of the range to hold as a floor. After all, this lines up with the dynamic support at the moving averages, too!


GBP/AUD: 4-hour

This comdoll cross also just bounced off a strong resistance level and might be gearing up for a test of support.


As you can see from the 4-hour chart above, GBP/AUD created an ascending triangle pattern. Will the formation still hold?



Technical indicators appear to be hinting at the presence of bullish vibes. The 100 SMA just crossed above the 200 SMA while Stochastic is approaching oversold levels to indicate that sellers could use a break.

In that case, you might be better off waiting for a bounce off the triangle support and catching a move back to the resistance at 1.8940.


If you’re gutsy enough to catch the latest selloff, just make sure you set your stops right and practice proper risk management!