Dukascopy Bank Team
Dukascopy Bank SA
AUD/NZD 1H Chart: Triangle
Comment: AUD/NZD appears to have formed a triangle within the channel we looked at yesterday. Given the overall bullish bias and the signals provided by the technical indicators, the break-out to the upside seems a lot more likely than a decline. Above 1.0770 the currency pair should aim for the January 19 high at 1.0840. Nevertheless, there is also a strong counterargument, since the Aussie is overbought (74% of positions are long), meaning we should not rule out a sell-off. If the price closes below the weekly PP, the next target will be the 200-hour SMA and the daily S1 at 1.0735, while the main support is at 1.07, provided by the lower boundary of the channel in the four-hour chart.
USD/PLN 1H Chart: Triangle
Comment: For some reason there is a striking similarity between the current situations in AUD/NZD and USD/PLN. Both have triangles forming within the ascending channels. However, the case for a rally here is somewhat stronger, considering that the US Dollar is in fact oversold—68% of positions are short. Accordingly, our base case scenario is a rally through the near-term trend-line at 4.1370 and the January 21 high up to the upper edge of the channel between 4.19 and 4.20. Meanwhile, there are plenty of potential floors in case USD/PLN dips through 4.13. The first one will be the weekly PP at 4.1170, followed by a combination of the daily S2, January 22 low and the 200-hour SMA around 4.10.
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