Hi Traders! AUDNZD short term forecast and technical analysis post is here. The way I would like to analyze the chart for setups is based on multi-timeframe confirmations because in my POV, if we get more evidences on different timeframes for the same direction then it makes the setup much more reliable. If you would like to learn more about the way we trade and the technical analysis we use then check out the Home Trader Club Spoiler alert – free memberships are available! Let’s start our analysis from the highest timeframe which will be the daily chart here.
AUDNZD D1(Daily) Chart Analysis – Bearish Trend Pattern, Bearish Hidden Divergence, Parabolic Sar
On the daily chart, we could see that the price which was moving lower has created a bearish trend pattern in the form of three lower highs, and lower lows we may consider this as evidence of bearish pressure. Generally, after a bearish trend pattern, we may expect corrections and then a further continuation lower. Currently, it looks like the correction that we are looking for is happening. In addition to this, the price has reached a strong resistance zone, respected it and is bouncing lower from this zone. Also, we have a bearish hidden divergence that formed between the first high formed at 1.10447 and the second high formed at 1.09361, based on the MACD indicator, we may consider this as another evidence of bearish pressure. In addition to this, based on the Parabolic Sar we could see that the dot is above the price which we may consider as yet another evidence of bearish pressure. We may now move down to lower timeframe and see if we can find evidence supporting this short-term bearish view.
AUDNZD H4(4 Hours) Chart Analysis – Key Resistance Zone, Bearish Divergence, ADX Indicator
On the H4 chart, the price reached a key resistance zone that has formed based on the 100%(1.09182) Fibonacci expansion level of the first wave and the 61.8%(1.09536) Fibonacci expansion level of the second wave. The price respected this zone and is currently moving lower. Also, we have a bearish divergence that has formed between the first high formed at 1.08788 and the second high formed at 1.09374 based on the MACD indicator which we may consider as evidence of bearish pressure. In addition to this, the ADX indicator gave a bearish signal here at the cross of -DI (red line) versus +DI (green line) and the main signal line (silver line) reads value over 25 which we may consider as yet another evidence of bearish pressure. So everything looks good here for the bears and until the key resistance zone (marked in red) shown in the image below holds my short-term view remains bearish here. A valid breakout below the last low at 1.07980 would be the validation for this bearish view.
Technical Analysis & Forecast Summary
AUDNZD D1(Daily) Chart Analysis
- Bearish Trend Pattern, Bearish Hidden Divergence, Parabolic Sar
AUDNZD H4(4 Hours) Chart Analysis
- Key Resistance Zone, Bearish Divergence, ADX Indicator
Trading Tips
It is always recommended to look for confirmations before you jump into any trade. If you are not sure about how to trade this short-term sell setup then you can use any setup and strategy that you have in your arsenal to look for bearish moves and join this sell trade.
Also, don’t forget to protect your sell trade using a stop loss and make sure to set a target and keep a proper risk/reward ratio.
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Happy Trading!
Arvinth Akash
Home Trader Club Team.
