Trade of the Day: AUD/NZD

By: Dima Chernovolov

AUD/NZD continues to rise inside the daily Down Channel chart pattern, which was previously identified by Autochartist. Autochartist rates the quality of this Down Channel at the 7-bar level – which is the result of the strong Initial Trend (7 bars), medium Uniformity (5 bars) and maximum (10 bars). AUD/NZD is expected to rise further inside this Down Channel in line with the earlier upward reversal from the support zone highlighted below.

As can be seen from the daily AUD/NZD chart below, the price earlier reversed up from the support zone located between the long-term support level 1.0550 (which stopped the sharp downtrend in July) and the lower daily Bollinger Band. The proximity of this support area and the bullish divergence on the daily Stochastic indicator increase the probability AUD/NZD will continue to rise inside this daily Down Channel.