NZD/USD 1H Chart: Rising Wedge

Dukascopy Bank Team Dukascopy Bank SA

EUR/SGD 1H Chart: Channel Down

Comment: EUR/SGD topped September highs early October, just to prove disequilibrium and give in to supply pressures, by entering a descending channel, which the pair has been maintaining. Losing volatility, an additional channel down has extended the latest wave, suggesting that the pair could reach the bottom trend-line around 1.5117 or 1.5087 and hover in the middle of the pattern a little longer. Decent support is currently provided by 1.5184, where the weekly S1 and junior channel bottom trend-line clusters, serving as an entry point for a slide towards the senior trend-line. The 1.5227/5225 area is capping upside movements for now and we look for it to fail there if more attacks are launched. There is, however, a strong possibility that the rate might fail to dip underneath 1.5222, as the two-month channel up could prove its dominance and cause the rate to break both junior ones. We would then look for 1.5433 as the ultimate target for the next large-scale wave.

NZD/USD 1H Chart: Rising Wedge

Comment: A break below the bottom trend-line of the week-long wedge NZD/USD traded in suggests that a steep downward motion will extend the recent theme, further implying that a retracement should take place after the plunge is executed. We see the 0.7181/7166 area as one capable to limit dips underneath in the short term, with further risks skewed to the downside when the correction is completed. Considering the incomplete channel-like form of the recent motion, a possibility of the bullish market extension cannot be eliminated – meaning that should NZD/USD limit its weakness with 0.7207, a bounce towards the upper trend-line would confirm the channel, which would then lead to tests of levels above the channel bottom line.

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Dukascopy Bank Team

Dukascopy Bank SA

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