Australian Dollar: USD/AUD (AUD=X) a break down below the 0.60 level is very likely that we go crashing into the 0.58 level
The Australian dollar initially tried to rally during the trading session on Thursday but give back the gains as we started to see a lot of negativity out there. Ultimately, this is a market that requires a certain amount of risk appetite but if we break down below the 0.60 level is very likely that we go crashing into the 0.58 level. This will be about whether or not there is going to be demand for global trade, and quite frankly with the shocking initial jobless claims figures coming out the United States, that’s a huge hit to global outlook as far as demand will be concerned.
In order for this pair to suddenly look strong again, we need to clear the 61.8% Fibonacci retracement level which is closer to the 0.6250 level. This has been a strong bounce, but quite frankly it’s a bit of a “dead cat bounce”, at least from a quick visual look at it. I fully anticipate that a lot of fear will enter the market and drive up demand for the greenback. More importantly, it’s difficult to see a driving up demand for the Australian dollar. The greenback will probably win by default in this scenario. Furthermore, there will probably be even more rapid movement in the AUD/JPY pair, which tends to move in the same direction based upon risk appetite. Rallies should continue to offer selling opportunities on short-term charts, but all things being equal it is all about the global coronavirus crisis, which seems to be a long way from ending.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
By the way, prices are vulnerable to a correction towards 0.63.
The projected upper bound is: 0.62.
The projected lower bound is: 0.59.
The projected closing price is: 0.61.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 7 white candles and 3 black candles for a net of 4 white candles. During the past 50 bars, there have been 22 white candles and 28 black candles for a net of 6 black candles.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 41.8087. This is not an overbought or oversold reading. The last signal was a sell 2 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 40.46. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 8 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 43. This is not a topping or bottoming area. The last signal was a buy 8 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 5 period(s) ago.
Rex Takasugi – TD Profile
FOREX AUD= closed up 0.001 at 0.607. Volume was 53% below average (consolidating) and Bollinger Bands were 147% wider than normal.
Open High Low Close Volume___
0.606 0.607 0.604 0.607 31,167
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 0.60 0.64 0.67
Volatility: 20 20 12
Volume: 119,549 83,700 63,702
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FOREX AUD= is currently 10.1% below its 200-period moving average and is in an downward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume out of AUD= (mildly bearish). Our trend forecasting oscillators are currently bearish on AUD= and have had this outlook for the last 58 periods.