Strategy 05 February 2014

AUD/NZD – Daily Chart

AUD/NZD has reversed from major support and targets 1.1150.

We highlighted last week that AUD/NZD was bouncing off the 1.0501/1.0434 major support zone which consists of the 1995 and 2005 lows And we were looking for a major reversal higher.
We recommended buying AUD/NZD in the 1.0600 region – we are raising stops on longs from 1.0400 to a profit stop of 1.0665 and maintain an upside target at 1.1150.
We noted the positive RSI divergence and because AUD/NZD bounced off the psychological 1.0500 level we are of the opinion that another significant low was made at 1.0493. This is why we changed our technical view from a neutral to a bullish one. We will retain our bullish outlook while no daily close below the 1.0400 level is being made. If so, allow for parity to be targeted.
Upside targets are the double Fibo at 1.1010/36 then the August and September lows at 1.1157/99.
Near term dips are indicated to terminate circa 1.0750.
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