Intraday Market Strategies: NZDJPY and EURAUD Technically Driven Entries

Intraday FX Strategies

NZDJPY has caught our attention in the Foreign Exchange (Forex) market following the weekly close. We remind that NZ inflation expectations as well some remarks by Kuroda are expected during the Asian session.

Please click on the chart to enlarge:

NZDJPY 4hr Chart 05/11/17

NZDJPY Intraday Strategy

NZJPY was capped by the 100 Moving Average (MA, in orange). The price requires to test the lower support line (around 78.40) and post a 4hr close above to provide an entry. The dip, if materializes may paint the right-hand shoulder of the reversal pattern (reversed H&S).

Following a successful re-test and a 4hr close above support the price is expected correct higher, targeting the neckline (upper blue line). A break above the neckline, preferably a 4hr close as an additional confirmation may pave the way for firmer gains, targeting 79.75. The upper MA (in pink) is the 200MA.

In an event a 4hr close is noted below the support line (lower blue line) rather than a successful re-test an entry ma be provided at a lower price (latter support marked in green, around 78.08). We must highlight that a break below the initial support (in blue) may not necessarily suggest further weakness. An entry may only be provided should the price re-test the latter support (in green).

At the time of this writing NZDJPY intraday strategy is not meant to still be relevant by Thursday when the RBNZ is due to announce its monetary policy but we will issue an update on NZDJPY if found relevant on Wednesday.

EURAUD Intraday Strategy

EURAUD 4hr chart as opposed to NZDJPY may suggest an entry is available at market price. We must highlight that the price can still re-test the upper resistance (around 1.5200) before reversing lower.

Please click on the chart to enlarge:

EURAUD 4hr Chart 05/11/17

We marked 1.5145 as the key intraday level for EURAUD strategy. The price level is not intended to be used for dip-buying strategies. As the protective stop must be layered above the resistance (upper green line), a 4hr close below 1.5145 may provide the ability to layer a tighter stop in EURAUD as 1.5145 may then act as the nearest resistance.

A 4hr close below 1.5145 may be followed by corrective gains towards 1.5145, which may then allow traders to exercise dip-selling strategies, targeting the lower support line (in green, around 1.5080).

A break above the resistance, should it occur may not necessarily suggest further gains are in store as we noted firm resistance levels on the daily chart, which may lessen the attractiveness of long positions due to the poor RR.

We cannot determine whether the entry may still be relevant when the RBA will release its monetary policy, we will issue an update if found relevant.