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AUD/CAD - continue to decline?


TREND:
short term (form November 2017) - market is downward trend
long term (from May 2017) - market is downward trend

RANGE:
short term (form November 2017) - 0,9900 - 0,9600
long term (from May 2017) - 1,0350 - 0,9600

RESISTANCE:

0,9700
0,9770
0,9920

SUPPORT:

0,9600
0,9400
0,9340

ANALYSIS:
Recently AUD/CAD crossed previous support at 0,9700. Now support is a resistance. I expect that the market will continue negative scenario and the course will drop to 0,9600. From the last few …
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Woolf 20 11月

Weekly line chart. It show that market hitting new levels

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More Losses for the USD/JPY

The USD/JPY had a remarkable run since the second half of 2016. We saw the pair rally by almost 2,000 pips from the lows to hit 118.65. But in the past few months the gains have stalled and recently the trendline underpinning the move higher has been broken, as you can see on the weekly chart below.
We’re already down by almost 700 pips right now but bodies in motion tend to stay in motion. And currencies in a downtrend tend to continue in that direction. I’m targeting more of the same during A…
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Will the long term trendline hold the euro again?

Technical Tools
Support and resistance (S/R). Price levels, trendlines and Fibonacci retracements. Price action, candlestick and chart patterns. Simple moving averages (SMA). Commitments of traders (COT) indicator, which displays speculative positioning in FX futures market, used as a proxy for speculative positioning in spot FX market.
Weekly Chart
The pair has been consolidating in the 1.05 - 1.15 range since Q1 2015. It is testing the long term trendline drawn off of 1985 and 2000 lows and re…
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al_dcdemo 9 11月

UPDATE 5: Risk assets and the dollar sold off initially when it had became clearer and clearer that Donald Trump will be the next president of the United States. Traders were quick to buy the dip and the rally took off as the news was widely confirmed. I expected at least one more day of selling but the price action seems logical. Markets are inherently optimistic while Trump presidency really isn't such big a deal. What we saw was the Fed trade returning with force, in my view.

al_dcdemo avatar
al_dcdemo 11 11月

UPDATE 6: The euro once again sits just above the long-term trendline, drawn off of 1985 and 2000 lows. Speculation is that, with Trump and the Republicans at the helm, the U.S. will enter a reflation period that will bring about jobs, growth, inflation and higher interest rates. The pair posted a huge reversal pattern on the election day but in the current range-bound environment its significance is diluted. Still, both technicals and fundamentals point lower and the next stronger support is seen near 76.4% retracement of the December 2015 - May 2016 upswing, at 1.0780.

al_dcdemo avatar
al_dcdemo 19 11月

UPDATE 7: In the second week after the U.S. presidental election, the U.S. dollar rose against all G10 major currencies bar the Canadian dollar, which tends to perform well on the crosses in the strong U.S. dollar environment. The yen was the weakest of the bunch with the antipodean dollars not very far behind. U.S. dollar index blasted through 100 and closed the week on thirteen-year highs. If current market assumptions (large fiscal stimulus, further tightening by the Fed) prove to be correct, this could well have been the start of the second leg of the multi-year U.S. dollar move.

al_dcdemo avatar
al_dcdemo 23 11月

UPDATE 8: After ten days of declines during which it fell more than seven cents (700 pips), the euro paused at the trendline drawn off of 2015 lows. The pullback has so far been less than one cent but traders may step up covering if the move stalls further. Buying may accelerate if the pair trades through the immediate resistance between 1.0650 and 1.0675. On the other hand, a daily close below 1.0575 could lead to continuation of the downtrend, targeting last year's lows, 1.0520 and 1.0460.

al_dcdemo avatar
al_dcdemo 28 11月

UPDATE 9: The U.S. dollar appreciated against most of the G10 major currencies in the three weeks after the U.S. election. An exception is the pound which has been completely disconnected from the U.S. dollar trade and remained range-bound. Australian and New Zealand dollars, supported by yield advantage and the former also by rising copper prices, started their corrections a bit earlier. Low-yielders, the euro, the franc and the yen, recouped some of the losses on Friday and earlier today, but the U.S. dollar bulls were quick to buy into the dips. Price action suggests a risk-on week ahead.

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Loonie still in a range

After falling in five consecutive days, from 1.31 last Tuesday to 1.2825 on Monday, USD/CAD snapped more than half of the decline yesterday.
Nearly 5% fall in oil amid more general risk-off environment saw the pair rising back above 1.30. That puts 1.32 back into view and possibly 1.35 on a successful breakout.
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Yen still contained

The Yen continues to make lower lows and lower highs. Today, it briefly traded below August 2015 low (~116.20) and pierced 116 level which is an upper extreme of a strong 115.5 - 116 support zone.
The support zone is a neckline of a big head and shoulders pattern on the weekly chart. If it gives way, measured move would target 105 - 107 which also includes 38.2% retracement of the 2011 - 2015 uptrend (~106.65), 2013 high (~105.5) and October 2014 low (~105.2).
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NZD/USD will be kept in check by the RBNZ

Monthly chart
In January, the pair busted 100 month SMA and 38.2% retracement of the 2009 to 2011 uptrend. February, March and April were more or less range-bound, but in May the pair broke to the downside strongly in what proved to be continuation of the downtrend. In June, 0.70 and 50.0% retracement (0.6868) were convincingly broken and the pair fell to almost 0.60 by the end of August. It stalled in September and then pulled back sharply in October.
Weekly chart
From late April to early July…
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al_dcdemo 23 11月

UPDATE 5: Trade Balance is the only top tier indicator that New Zealand will publish in the week ahead. U.S. will report several important data points: Prelim GDP, CB Consumer Confidence and (Core Durable) Goods Orders. 50 and 100 DMA will be the key levels to stay above in the coming days. Near term potential is to 0.6750 while 0.70 may not be unreasonable target over slightly longer horizon.

al_dcdemo avatar
al_dcdemo 24 11月

UPDATE 6: Kiwi started the week on the back foot as it pulled back some 60 pips from the opening level before 0.65 level stopped the decline. After briefly trading above 0.66 on Friday, the pair fell back below both 50 and 100 DMA. It looks well supported into 0.65 and if the level holds the pair will be on the way to 0.6750 and, perhaps, 0.70. If the level fails, a retest of 0.6350 - 0.6400 and possibly cycle-low at 0.6235 will become probable.

al_dcdemo avatar
al_dcdemo 27 11月

UPDATE 7: 100 pip range might not be considered small in the Kiwi but in relative terms, with regard to price action in recent months, it is. The pair started the week on the back foot but managed to hold above 0.65. It made several attempts at 0.66 on Thursday to no avail and then the U.S. dollar strength on Friday sent it back below both 50 and 100 DMA.

al_dcdemo avatar
al_dcdemo 29 11月

UPDATE 8: ANZ Business Confidence and GDT Price Index are the only high impact events from New Zealand on the calendar for the week ahead. U.S. macroeconomic data includes: ISM Manufacturing PMI, ISM Non-Manufacturing PMI and NFP report, plus a testimony from Fed's Yellen. Technically, 50 DMA crossed above 100 DMA few days ago while 0.65 remains the most important level to keep an eye on.

al_dcdemo avatar
al_dcdemo 1 12月

UPDATE 9: Kiwi continued yesterday's strength and broke above last week's range and 0.66 level that capped it on several occasions in the past three weeks. Better data from Australia and China overnight didn't do it any harm. The pair is effectively back above 50 DMA which is a part of a strong resistance (now support) zone between 0.6590 and 0.6610. Interim target is 0.6750 on the way to 0.70, ahead of which we have 200 DMA (currently ~0.6920) and a declining trendline drawn off of 2014 and 2015 highs (currently ~0.6930).

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NZD/USD to continue sideways

Monthly chart:
In January, the pair busted 100 month SMA, 38.2% retracement of the 2009 to 2011 uptrend and the low of the 2011 to 2014 trading range around 0.7350. February, March and April were more or less range-bound, but in May the pair broke to the downside strongly in what proved to be continuation of the longer term downtrend. In June, 0.70 and 50.0% retracement of the 2009 to 2011 uptrend (0.6868) were convincingly broken and the pair fell to almost 0.60 during July and August before it…
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al_dcdemo 25 9月

UPDATE 1: Kiwi broke to new six-year lows on Tuesday but the breakout proved to be fake as the pair rejected lower prices and rallied into the close. It was also the pair that took the most out of yesterday's commodity pair rally. Profit taking in GBP/NZD and EUR/NZD might have also been a factor. However, sellers were quick to step back in after hawkish remarks from Yellen.

al_dcdemo avatar
al_dcdemo 27 9月

UPDATE 2: ANZ Business Confidence is the only noteworthy data point from New Zealand on next's week calendar. However, month-end and quarter-end flows combined with a slew of US economic events (Fed speakers, CB Consumer Confidence, ISM Manufacturing PMI and NFP report) will most likely provide decent volatility. 0.6225 - 0.6450 is the range that is protected by 50 DMA on the topside and strong support into 0.62 (also July 2009 low) at the bottom.

al_dcdemo avatar
al_dcdemo 29 9月

UPDATE 3: The pair started the week on a softer note but after 100 pip fall it pulled right back into the middle of its recent trading range between 0.6250 and 0.6450. Despite weakness in commodities and general risk-off sentiment, indecision has been the name of the game in the pair during the past few weeks. It may be that it has fallen enough, but most likely it's just another pause before continuation lower.

al_dcdemo avatar
al_dcdemo 2 10月

UPDATE 4: Kiwi traded mostly in the upper half of its recent (0.6250 - 0.6450) range this week which may signal that an upside break is in the making. Range top coincides with 50 DMA at the moment and, if the pair manages to break and hold above it, revisit of 0.65 - 0.66 zone is quite likely. However, we must be wary of a false breakout too as the longer-term trend is still to the downside.

al_dcdemo avatar
al_dcdemo 14 10月

UPDATE 5: RBNZ governor Governor Wheeler sent Kiwi tumbling by saying that "some further easing seems likely". That's nothing new as that's the exact line from the last rate statement but it came at the time when many traders were looking for excuse to book their profits after 500 pip rally from the low set in September. The decline stalled at 100 DMA, just above the broken trendline drawn off July and August highs. Should the pair continue to fall, 0.64 - 0.65 band (50 DMA, 50.0% retracement of the rally, September high) is the potential target.

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NZD/USD will remain heavy

Monthly chart:
In January, the pair busted 100 month SMA, 38.2% retracement of the 2009 to 2011 uptrend and the low of the 2011 to 2014 trading range around 0.7350. February, March and April were more or less range-bound, but in May the pair broke to the downside strongly in what proved to be continuation of the longer term downtrend. In June, 0.70 and 50.0% retracement of the 2009 to 2011 uptrend (0.6868) were convincingly broken and the pair fell to almost 0.60 before pulling back.
Weekly cha…
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al_dcdemo avatar
al_dcdemo 27 9月

UPDATE 8: ANZ Business Confidence is the only noteworthy data point from New Zealand on next's week calendar. However, month-end and quarter-end flows combined with a slew of US economic events (Fed speakers, CB Consumer Confidence, ISM Manufacturing PMI and NFP report) will most likely provide decent volatility. 0.6225 - 0.6450 is the range that is protected by 50 DMA on the topside and strong support into 0.62 (also July 2009 low) at the bottom.

al_dcdemo avatar
al_dcdemo 29 9月

UPDATE 9: The pair started the week on a softer note but after 100 pip fall it pulled right back into the middle of its recent trading range between 0.6250 and 0.6450. Despite weakness in commodities and general risk-off sentiment, indecision has been the name of the game in the pair during the past few weeks. It may be that it has fallen enough, but most likely it's just another pause before continuation lower.

WallStreet6 avatar

Great analysis as well! And quite close to the market price, may still get closer.

fxsurprise8 avatar

great forecast, will come down to the wire tomorrow

al_dcdemo avatar
al_dcdemo 1 10月

Thanks to both!

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NZD/USD in sideways mode

Monthly chart:
In January, the pair busted 100 month SMA, 38.2% retracement of the 2009 to 2011 uptrend and the low of the 2011 to 2014 trading range around 0.7350. February, March and April were more or less range-bound, but in May the pair broke to the downside strongly in what appears to be continuation of the longer term downtrend. In June, 0.70 and 50.0% retracement of the 2009 to 2011 uptrend (0.6868) were convincingly broken and the pair traded down to 0.65 before pulling back.
Weekly ch…
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al_dcdemo avatar
al_dcdemo 10 8月

UPDATE 4: New Zealand retail sales, US retail sales and PPI reports are the macroeconomic events that have the potential to move the pair in the week ahead. With more RBNZ rate cuts expected, the underlying trend is still to the downside, but there's potential for a near-term correction. 0.6650 is the initial resistance before the trendline drawn off July 10th and July 29th highs (~0.67). Support is seen near 0.6550.

al_dcdemo avatar
al_dcdemo 15 8月

UPDATE 5: Price action in the pair closely resembled that in the Aussie as both are risk currencies that can be used as a proxy of Chinese economy due to their import/export relationships. However, Kiwi's close was weak and the weekly candle is bearish with the lowest close in a month. That is another sign of the current divergence between the two economies.

al_dcdemo avatar
al_dcdemo 16 8月

UPDATE 6: GDT Price Index and PPI report are the only events from New Zealand that may exert a bit of an influence on the pair in the week ahead. US inflation report and FOMC meeting minutes may also send few jitters through the pair. Initial support is seen at 0.65 and then near 0.6465 low. Some resistance shall be found around 0.6560 and then between 0.6600 and 0.6650.

al_dcdemo avatar
al_dcdemo 28 8月

UPDATE 7: Pip-wise, weekly range in the pair was the second largest among seven majors. However, if we look at it as percents of value, it was the largest. Thin summer liquidity perhaps contributed to this enormous range, most of which was basically defined in a couple of minutes. The pair recovered roughly half of its losses but will close the week below the pivotal 0.65 level.

al_dcdemo avatar
al_dcdemo 29 8月

UPDATE 8: ANZ Business Confidence and GDT Price Index will be the fundamental highlights from New Zealand in the week ahead. US will release ISM Manufacturing PMI, ISM Non-Manufacturing PMI and NFP reports and particularly the latter will be scrutinized for rate hike implications. Technically, 0.6375 - 0.6400 band is important as it includes two long term retracements: 50.0% of the 2000 to 2011 uptrend and 61.8% of the 2008 to 2011 rally.

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NZD/USD has further to fall

Monthly chart:
In January, the pair busted 100 month SMA, 38.2% retracement of the 2009 to 2011 uptrend and the low of the 2011 to 2014 trading range around 0.7350. February, March and April were more or less range-bound, but in May the pair broke to the downside strongly in what appears to be the continuation of the longer term downtrend. In June, 0.70 and 50.0% retracement of the 2009 to 2011 uptrend (0.6868) were broken and the pair is poised to close the month below both levels.
Weekly char…
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al_dcdemo avatar
al_dcdemo 25 7月

UPDATE 8: On the latest rally, the pair ran out of steam at the trendline, drawn off of May 14th and June 10th highs. That will be the first stronger level to breach to signal that the downtrend has run its course. But with RBNZ firmly in its easing seat and with few more rate cuts expected by the end of the year, support at 0.65 is likely to fall first.

WallStreet6 avatar

About 100 pips away- the kiwi could come close as well. Great analysis with many indicators taken into account! Good Luck!

al_dcdemo avatar
al_dcdemo 31 7月

Thanks! Let's hope for a Monday attempt at the downside. :)

al_dcdemo avatar
al_dcdemo 31 7月

UPDATE 9: The pair traded on both sides of the previous week range before returning to close in the lower half of it. This was the second week in a row that the pair managed to close higher - last time that this happened was in February. Upper tails on both weekly candles are substantial but inability of the pair to close below the open is quite telling too.

al_dcdemo avatar

UPDATE 10: Next week will be very important in terms of economic data. NFP and ISM reports from the US will be come out and New Zealand will release its latest labour market figures. 0.65 support proved to be a decent one, but demand appears to start coming in at 2010 low (~0.6560). Should the levels hold, a period of consolidation may follow and last at least until September FOMC meeting.

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