Australian Dollar: USD/AUD (AUD=X) Downside Momentum Targets .6851 – .6809
After showing signs of strength early in the session on the back of solid Chinese Gross Domestic Product (GDP) data, the Australian Dollar reversed to the downside to finish lower for the session. Stronger-than-expected U.S. housing data drove Treasury yields higher, making the greenback a more attractive asset. This weighed on the Aussie into the close.
Also contributing to the weakness were concerns over the impact of the bushfires on the Australian economy and continued worries about a possible rate cut by the Reserve Bank of Australia (RBA). Position-squaring ahead of this week’s Australian employment reports also pressured the Aussie.
Daily Swing Chart Technical Analysis
The main trend is down according to the daily swing chart. A trade through .6877 on Friday turned the main trend down. A move through .6934 will change the main trend to up.
The main range is .7082 to .6671. Its retracement zone at .6876 to .6925 is controlling the longer-term direction of the AUD/USD.
The short-term range is .6671 to .7032. Its retracement zone at .6851 to .6809 is the next downside target and potential support area.
Daily Swing Chart Technical Forecast
Based on Friday’s close at .6872, the direction of the AUD/USD on Monday is likely to be determined by trader reaction to the main 50% level at .6876.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 0.69.
The projected upper bound is: 0.69.
The projected lower bound is: 0.69.
The projected closing price is: 0.69.
During the past 10 bars, there have been 3 white candles and 6 black candles for a net of 3 black candles. During the past 50 bars, there have been 16 white candles and 27 black candles for a net of 11 black candles.
A gravestone doji occurred. This often signifies a top (the longer the upper shadow, the more bearish the signal).
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 31.4283. This is not an overbought or oversold reading. The last signal was a buy 8 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 28.71. This is where it usually bottoms. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 7 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 -78. This is not a topping or bottoming area. The last signal was a buy 5 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 sell 11 period(s) ago.
Rex Takasugi – TD Profile
FOREX AUD= closed unchanged at 0.687. Volume was 98% below average (consolidating) and Bollinger Bands were 75% wider than normal.
Open High Low Close Volume___
0.687 0.687 0.687 0.687 38
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 0.69 0.69 0.69
Volatility: 1 1 1
Volume: 1,053 1,944 2,177
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 0.3% below its 200-period moving average and is in an downward trend. Volatility is relatively normal 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 30 periods. Our momentum oscillator is currently indicating that AUD= is currently in an oversold condition.
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