(Jing Ren – Orbex)
NZDUSD tests supply zone
The New Zealand dollar bounces higher after Q2 CPI exceeded expectations. Despite a choppy price action, general sentiment remains downbeat. Trend followers have been eager to sell into strength. The latest rebound lifted offers at 0.6160, prompting some short-term sellers to cover. The bulls will need to clear the supply area around 0.6200 before they could push for a meaningful recovery. 0.6120 is the closest support. A breakout could cause a sell-off below 0.6070 and then send the kiwi to the psychological level of 0.6000.
XAG/USD sees limited rebound
Silver recoups losses as risk assets recover at the expense of the US dollar. As the price approaches July 2020’s lows around 17.80, an oversold RSI on the daily chart suggests potential exhaustion in the current downtrend. The precious metal could use a rebound to take a breather. The RSI’s oversold situation on the hourly chart triggered a ‘buying-the-dips’ behavior. 19.40 has proven to be a tough resistance to crack and could cap the bounce. A bullish breakout, however, would trigger an extended rally above 20.00.
DAX 40 bounces off critical support
The Dax 40 consolidates ahead of the ECB interest rate decision later this week. The price action has been treading water over last March’s low near 12420, which suggests interest in keeping the index from dipping into bearish territory. However, the buy side needs to show stronger commitment to turn sentiment around. A rally above the psychological level of 13000 may attract more follow-up buying. On the downside, a fall below 12680 would send the index back to the bulls’ last stronghold at 12420.
XAUUSD: Triple zigzag completion is a signal of an imminent increase in gold prices
The XAUUSD formation hints at a global correction pattern that takes the form of a cycle triple zigzag.
The current chart shows the internal structure of the bearish cycle intervening wave x, which looks completed in the form of a primary triple zigzag.
Perhaps, after the completion of the cycle wave x, the market turned around and began to move up. That is, the construction of the initial part of the cycle wave z could begin. It can be any correctional model.
The price of gold in wave z may rise to the previous high of 1998.53, which was marked by the primary wave, or even higher.
Alternatively, we can expect the continuation of the downward price movement in the cycle wave x. Wave x is also a triple zigzag, as in the main version.
However, in this scenario, the final primary wave is still under development. In the near future, a downward movement of XAUUSD is expected in the intermediate impulse wave (C), which is part of the zigzag wave.
The primary wave can complete its zigzag pattern (A)-(B)-(C) near 1617.96. At that level, it will be at 123.6% of primary wave.