Forex Trading: Aussie and Kiwi Perspectives September 21, 2018

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Aussie and Kiwi have managed to increase on the short term versus the USD as the dollar was punished by the USDX’s aggressive drop. I’ve said today in another article that the USDX could drop further in the upcoming period of the breakdown below a crucial support will be confirmed.

However, we still need confirmations on the AUD/USD and NZD/USD that the pairs will resume the temporary rebound. The pairs are trapped below some very important resistance levels. The USD has recovered a little before the United States data were released.

The Flash Manufacturing PMIĀ  was reported at 55.6 points, much above the 55.1 estimate and versus 54.7 in the previous reporting period, while the Flash Services PMI dropped unexpectedly lower, from 54.8 points to 52.9, even if the specialists have expected to see an increase to 54.9 points.

The AUD/USD decreased a little today after the retest of the upside 50% Fibonacci line of the descending pitchfork and the downtrend line. The potential Falling Wedge was invalidated when the rate has made the aggressive breakdown below the downside line and below the ML.

Price has failed to reach and retest the inside sliding line (SL) from below the ML, signaling a potential reversal. I’ve drawn a minor ascending pitchfork to catch the upside movement. You can see that the rate has jumped above the median line (ml). A valid breakout above the 50% Fibonacci line and above the downtrend line will announce a further increase towards the upside sliding line (sl) of the descending pitchfork. This line represents a very strong resistance, it has rejected the price in the past. Personally, I believe that we’ll have a larger upside movement if the rate will stay above the median line (ml) and if it will make a valid breakout above the upside 50% Fibonacci line.

NZD/USD increased after the false breakdown below the lower median line (lml) and below the 0.65443 static support. Price rebounded after the failure to approach, reach and retest the upper median line (UML) of the major descending pitchfork. It remains to see if it will have enough bullish energy to reach the inside sliding line (sl) of the ascending pitchfork, which represents a very strong dynamic resistance. Resistance can be found also at the 150% Fibonacci line of the major descending pitchfork. A valid breakout above the inside sliding line (sl) will signal a larger upside movement and most likely the rate will make a valid breakout above the 150% as well.

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