~ Week Of June 27th 2016 ~
Published by Jay - June 28th 2016
The past few days have seen the financial markets in turmoil after the results of the Brexit referendum, with many currency pairs printing off massive price movements. One pair untouched by the Brexit storm is the AUDNZD. After a break of support on the 9th of June the market has been consolidating, tracking sideways for the past two weeks.
Price will not remain in this sideways motion forever, and we can look for a breakout from this consolidation in the future. If we do see a large and convincing move through the upper or lower consolidation levels, we could then look to play a retest if price rotates back to either of those levels.
Looking at the chart below, the path of least resistance appears to be down, with plenty of room to move. As indicated from recent events though, anything is possible in the foreign exchange market, so we will wait for price to show us the way. If we were to consider taking a trade on the break of this sideways movement we would want to see a large and noticeable candle making the break, rather than a cluster of smaller ones. As mentioned, it has to be a convincing move showing a strong directional bias.