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Forex: Aussie and Kiwi bulls forced to throw in the towel

By FXstreet.com,  January 20, 2011, 09:23:00 PM EDT

FXstreet.com (Barcelona) - The two oceanic currencies gave up multi-week highs mid this week, plummeting quite aggressively in the last 24/36 hours after a fakey upmove. Sellers continue lightening up to extend the ongoing bearish storm, which so far has driven both currencies to fresh weekly lows at the mercy of a strengthening US Dollar, buoyed by encouraging news in the housing sector.

David Solin, Principal Partner at DXA favours further downside on the Kiwi, saying that "Bearish view in kiwi remains unchanged, as the 5 wave fall from the Nov high at .7970 continues to argue that the downside is not "complete", with eventual declines back to the Dec low at .7345 and even below still favored".

He added: "Currently, the market is sharply lower from the Jan 19th high at .7785 (and slight, false break of the bearish trendline since Nov), tumbling to test support at .7525/40 (both the base of the multi-week bearish channel and a 62% retracement from the Dec low at .7345). Any near term bounce would likely be limited and short-lived, and before resuming the bigger picture decline".




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Investing, Forex and Currencies

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