A sharp setback in AUDNZD from the 21 week moving average 3 weeks ago appeared to confirm a negative bias- a tone that has been the prime element for the cross since last May.
But although demand from higher lows initially stalled at the average last week saw demand of almost 2 big figures in AUDNZD after an early move lower had been rejected. The resulting gains provided the most positive weekly close since October, clearly breached the key average line and also produced a positive RSI cross.
The upside stalled at the lower end of the weekly Ichimoku cloud and this may lead to a correction but our technical indicators are now clearly bullish and we look for setbacks to find fresh buyers with upside potential to an initial objective of 1.0786, a 50% recovery of the Mar-Sep decline, or even a broader 62% at 1.0916.
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