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AUDNZD Holds the Line, Swing Low in Place?

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AUDNZD continues to trade near multi-year lows despite having carved out what could be a massive inverse head and shoulders pattern.

That structure, by the way, is still very much intact but not yet confirmed. But just because it hasn’t set up for us doesn’t mean the pair is void of favorable opportunities.

One level I’ve been keeping an eye on over the past two weeks is trend line support that extends from the October 2015 low. This level was previously tested on three separate occasions and is once again supporting prices this week.

As long as this level holds on a daily closing basis, the odds of a move toward the 1.0875 handle remains high with a close above it exposing 1.1065 followed by 1.1330.

That said, it’s important to wait for bullish price action at current levels to suggest that a swing low is truly in place.

If sellers should manage to break trend line support, the next level of focus would be 1.0500. This area helped form the left and right shoulders of the reversal pattern mentioned above.

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AUDNZD swing low at trend line support

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5 comments
Salim Jabagi says

Thanks a lot for your articles and analysis. I am learning a lot about forex trading just by reading your articles and ……

Reply
    Justin Bennett says

    Salim, that’s great to hear. Let me know if you’d like to see me write about anything else.

    Reply
R says

Thanks Justin. Your trading lesson ‘relation between price and time’ seems to be applicable on daily chart of AUDNZD. I noticed how the recent price action is not that steep compared to first week of May. This maybe a sign of trend change from down to up.

I am new to trading, so it might be very naïve thought 🙂

Reply
    Justin Bennett says

    You got it. It shows that sellers are less willing to sell at current levels than they were previously.

    Reply
Gregory Dzedzy says

Hello Justin, I see a nice Bat pattern on the Daily, Comming off major support at 1.0621 level, I also see bullish divergence on the 4hr. and the daily. I am bullish on this pair up to the 1.0858 level where there is major resistance due to the 200 sma and a key 38.2 fib level from the bat pattern. Happy Trading Greg

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