Consolidation on AUD/NZD Around 1.0895
The Australian versus the New Zealand dollar currency pair seems to have entered a consolidative phase. Are the bears going to attempt a shift in the market direction?
After the inverted head and shoulders pattern — left-side shoulder marked by the 1.0474 intermediary level, head by the 1.0418 low, right-side shoulder by the 1.0513 higher-low, and neckline by the firm 1.0551 level — put an end to the descending trend, the price extended until the 1.0842 high.
The fall that came by sent the price back to the head and shoulder’s neckline. As the bulls saw this as an opportunity to validate the neckline as support, they printed the 1.0540 low before setting in motion another rally — which climbed again at the 1.0826 area.
A renewed bearish attempt resulted in a third rally. Even if this one is not as steep as the previous two, it shows signs of definite bullish dominance, for it crafted the 1.0946 high.
Even if the high of 1.0946 is — at least for the time being — a turning point, given the bullish context, it may only serve the formation of a consolidative phase.
So, as long as 1.0895 is validated as support, further rise is possible, 1.0983 being the main bullish target. On the other hand, 1.0895 becoming a resistance zone translates into a drop that — firstly — has 1.0826 as objective.
From the 1.0639 low, the price entered into an ascending phase, one that noted the 1.0946 high.
Even if the price slipped under the 1.0921 intermediary level, as long as 1.0866 remains support, another rise is in the cards. Such a rise would first have to check 1.0921 before aiming for 1.0987.
Still, if 1.0866 cedes, then 1.0820 is the next bearish purpose.
Levels to keep an eye on:
D1: 1.0895 1.0983 1.0826
H4: 1.0866 1.0921 1.0987 1.0820
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Original from: www.earnforex.com
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