Long suffering readers of this blog may be fed up with AUDNZD, but I can tell you that now is time to get very interested indeed. We recently met 1.2620 a major extension of the recovery seen since 1.1655. 1.2620 has since been left behind with a minimal retrace. With the RBNZ cutting by 150 basis points yesterday, I belive that the structure I pointed out in http://you-buy-the-high-i-sell-the-low.blogspot.com/2009/01/nzdusd-event-risk-may-extend-negative.html is even more likely to pan out. If AUDUSD maintains a degree of strength which it has so far (I have been watching it all day), then there is every chance that we get a significant extension higher perhaps towards 1.3180/1.4170 as detailed in one of my first posts (http://you-buy-the-high-i-sell-the-low.blogspot.com/2008/11/audnzd-history-and-outlook.html). This would mark the break out of the monthly wedge which is also detailed in the history and outlook post. If that does take place we could potentially have much more of the same to come. We are at a crucial juncture for AUDNZD. It either maintains its twenty year wedge range, or as the AUD now yields more than the NZD it finally makes a break for it and does the decent thing. Here's hopeing for a violent extension and break out higher. There is likely to be a battle by the wedge resistance but it will be stop city just above it. Lets hope those stops are triggered.
Alternatively we see a more substantial retrace, but that is not my favoured outcome due to the failure to stop for breath at 1.2620, but either way it's got to have a go at the wedge this time, surely!
By the way for those not aware, by clicking on the chart above you can view a larger image and stand a chance of reading the text!
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