AUD/NZD - Opportunity for short positions after correction

AUD/NZD Daily Chart Our Expectations: Downward Long-Term Trend, Horizontal Correction and Diagonal. Possibility for short positions with stop 1.0748.

Alternative scenario: If the price does not keep its levels and rises above the multiple resistances and forms a new local peak, the correction can continue to 61.8% Fibonacci. By textbook, if that zone does not hold, the downward movement is counted to be over, and the trend has already changed to a long.

Comment: Decreasing main trend. Correction to horizontal and diagonal resistance. At these levels is also 38.2% Fibonacci, measured from the peak of August 10, 2018 to the bottom of March 25 this year, making them even more significant. Formation of price action tweezers at key levels of resistance - unsuccessful attempt to break the resistance zone and stay on a big spike in the previous day - a signal that buyers fail to take over and sellers control the market.

Fundamental: The market response is more than clear: AUD does not cut its rates, New Zealand does - yet the pair AUD/NZD is down. Signal that traders do not believe the decision of the central bank of the former.

Moreover, the production of iron ore from Brazil is reduced, which will keep exports of Australia at relatively high levels. The risks that the US will impose tariffs on China will greatly damage the Australian local currency.

Worries about the outcome of the forthcoming federal elections in Australia also weigh on the currency.

Stop 1.0748

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