Technical Analysis Summary - Commodity FX Bounce
On November 19, 2024, the commodity currencies, specifically the Australian Dollar (AUD), Canadian Dollar (CAD), and New Zealand Dollar (NZD), showed significant strength against the backdrop of rising geopolitical tensions and inflationary pressures. This analysis focuses on the technical aspects of AUD/USD and USD/CAD, highlighting key support and resistance levels, as well as market positioning.
AUD/USD Technical Analysis
The AUD/USD pair demonstrated a notable pullback to the support zone around 0.6480, which aligns with the previous analysis. The price movement approached the October low, establishing a potential resistance level for the Asian session. A bearish divergence was observed on the 1-hour Relative Strength Index (RSI), indicating that the pair may be overbought.
Despite this, the bullish sentiment remains intact, with traders encouraged to look for buying opportunities on dips towards support. Key levels to watch include:
- Support: 0.6480
- Resistance: 0.6585 and 0.6600
USD/CAD Technical Analysis
The USD/CAD pair has been on a downward trajectory, closing below its 2022 high for the second consecutive day. The price appears poised to retest a significant historical support/resistance level. The daily RSI (2) has not yet reached oversold conditions, suggesting there may be further room for declines.
However, the 1-hour chart reveals multiple support levels nearby, along with two bullish divergences in the oversold zone. This indicates a potential for a bounce back. Traders may consider fading into rallies towards Tuesday’s high, anticipating a further decline towards the 1.39 level. Key levels to monitor include:
- Resistance: Tuesday’s high
- Target: 1.39 level
Conclusion
The current technical landscape for AUD/USD and USD/CAD suggests a mixed outlook, with potential for further gains in commodity currencies amidst supportive market conditions. Traders should remain vigilant of key support and resistance levels while considering market positioning and sentiment.