AUDNZD Forming Rising Wedge PatternAUDNZD has formed a textbook rising wedge pattern on the 8H chart and has now broken to the downside, signaling potential bearish continuation. This setup typically indicates a loss of momentum in the prevailing bullish trend, and with the clean structure break now confirmed, the bears seem ready to take control. I’ve already entered short positions from the top edge of the pattern and am currently floating in profit, anticipating further downside toward the 1.0780–1.0800 zone.
From a fundamental perspective, the Australian dollar has been relatively stable but lacks a strong bullish catalyst at this point. The Reserve Bank of Australia is holding a cautious tone amid mixed inflation signals, while New Zealand’s economy is showing signs of potential resilience. The RBNZ remains committed to tighter monetary conditions for longer as inflation continues to hover above their comfort zone, which provides some support to NZD in the near term.
Technically, the break of the lower wedge support is significant. Price failed to sustain higher highs near 1.1000 and quickly retraced, showing bearish rejection. With the RSI diverging and volume fading near the top of the wedge, this was a high-probability reversal zone. As long as price stays below 1.0950, the bias remains bearish, and further sell pressure is expected.
I'm targeting 1.0780 as the next key liquidity level. It aligns with previous structure support and provides a favorable risk-to-reward setup. This setup is a clear example of price-action-driven reversal trading, paired with macroeconomic alignment. I’ll continue to trail stops as price progresses, but so far, AUDNZD is playing out exactly as anticipated.
