AUD/CAD and NZD/CAD: Trapped between averages

Brian Twomey Brian's Investment

Consistent to view long-term targets for the current 3 to 6 month period, horrendous currency pairs AUD/CAD and NZD/CAD are next.

Both AUD/CAD and NZD/CAD suffer from severe range compression. AUD/CAD is the better pair to trade but not by much. Both NZD/CAD and AUD/CAD are deeply oversold but blocked to move higher by solid averages. While NZD/CAD and USD/CAD correlate to USD/CAD at +83% and +73%, the correlation to USD/CAD is preventing USD/CAD to move higher.

Massive oversold USD/CAD must break the correlation to AUD/CAD and NZD/CAD to free float and allow USD/CAD to trade correctly and meet oversold targets.

AS AUD/CAD and NZD/CAD are the top pairs to overall NZD and AUD prices, blocked averages and range compression to NZD/CAD and AUD/CAD is enough to contain NZD/USD and AUD/USD to move significantly higher.

AUD/CAD from current 0.9451 to higher must break 0.9492, 0.9568, 0.9582, 0.9587, 0.9609 and 0.9621. Oversold AUD/CAD must trade to at least 0.9571 or 120 pips higher. Below, 0.9439 and 0.9356 hold absolute bottoms.

Weekly trades, long 0.9446 to target 0.9557 and 0.9576.

NZD/CAD

NZD/CAD from current 0.8759 is trapped between 0.8691 to 0.8805 and 0.8875. Above 0.8875 then next comes 0.8913 and 0.8978 at the 5-year average. Most vital to NZD/CAD is the 10 year average at 0.8789 then 0.8691. NZD/CAD's price is located in a horrible position.

Weekly Trade: Long 0.8741 to target 0.8826 then 0.8847.

Author

Brian Twomey

Brian's Investment

Brian Twomey is an independent trader and a prolific writer on trading, having authored over sixty articles in Technical Analysis of Stocks & Commodities and Investopedia.

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