AUD/USD and NZD/USD Break Above Trendlines to Signal Bullish Reversal
The 4H AUD/USD chart shows the market in a sharp breakout above a declining trendline going back to the highs in late Feburary at 1.0855. The RSI in the 4H chart broke above 60, an initial sign that the bearish momentum is lost. Still, price action should break above 1.06 to test 1.0670 area in a bullish reversal scenario. It should also remain above 1.0550 in a throwback for the bullish scenario to be clearly developing.
The daily chart shows a market that has topped off with initial price action confirming respect for the top. That is why the bullish outlook for the current rally is to 1.0670. However, it should be noted that the RSI stayed above 40, a sign that the bullish momentum is preserved. Price action also remains above a flat 200-day simple moving average. These are signs of bullish bias. A more aggressive and still trend following target would therefore be toward the 1.0840 high. We just have to be cautious of the area around the 1.07 psychological pivot, especially if the RSI is at 60, in which case we should anticipate some short-term resistance.
The 4H NZD/USD chart shows a market in sharp bullish price action since the market touched 0.8058. The bearish outlook toward 0.79 is definitely shelved, and the market as very short-term bullish, in a medium term sideways market, especially if the market pushes above 0.8280, and pushes the RSI in the 4H chart above 60. In the short-term, a push above 0.83 opens 0.8340, then the 0.8420 pivot and the 0.8470 high.
Pushing below 0.82 should be a sign of bearish continuation. Staying above 0.8250, and pushing above 0.8350 should be a sign toward 0.8420 and 0.8470.
Actually, there is some bullish bias when looking at the daily chart.This chart shows the market staying above the 200-day SMA, and keeping the RSI reading above 40, just like the AUD/USD. These signs of bullish bias suggest that a return toward 0.8420 and 0.8470 highs are trend following targets with consideration that the market has flattened out. Just like the AUD/USD, you can also anticipate some short-term resistance when the daily RSI is at 60.