Timeframe: 4 Hour
Trend: Up
-AUD/USD has made strong gains over the last 2 weeks. Price is currently trading around the 0.50 fib level and is showing some rejection at the 0.50 fib level indicating that buying power is slowing down.
-Bearish divergence can be seen on the Stochastic RSI, indicating some pull back may be warranted to the 0.382 level. This would be good for the uptrend as old resistance is near that level and could act as support.
-Something else to look at is the correlation of NZD/USD (orange line) and AUD/USD, which has an approximate 90% positive correlation on the Daily TF and approximately 85% on the 4 hour TF. NZD/USD had a similar price action a few days ago and broke to the downside on Friday's session, taking a look some price action divergence can be seen there to. I am expecting AUD/USD to follow suite next week and break to the downside for a correction. Ideally NZD/USD would pull up a bit next week so the correlation between the two gets back into equilibrium.
-Look for price to possible correction to the 0.382 level (0.6830 area) and old resistance (0.6820 area).
Trend: Up
-AUD/USD has made strong gains over the last 2 weeks. Price is currently trading around the 0.50 fib level and is showing some rejection at the 0.50 fib level indicating that buying power is slowing down.
-Bearish divergence can be seen on the Stochastic RSI, indicating some pull back may be warranted to the 0.382 level. This would be good for the uptrend as old resistance is near that level and could act as support.
-Something else to look at is the correlation of NZD/USD (orange line) and AUD/USD, which has an approximate 90% positive correlation on the Daily TF and approximately 85% on the 4 hour TF. NZD/USD had a similar price action a few days ago and broke to the downside on Friday's session, taking a look some price action divergence can be seen there to. I am expecting AUD/USD to follow suite next week and break to the downside for a correction. Ideally NZD/USD would pull up a bit next week so the correlation between the two gets back into equilibrium.
-Look for price to possible correction to the 0.382 level (0.6830 area) and old resistance (0.6820 area).
Comment:
Price moving down as expected
Comment:
Price has moved down nicely, and could be testing the trend line at .68 area, look for further decline if rejection holds