Australian Dollar: USD/AUD (AUD=X) drifting higher
The Australian dollar rose against most major currency pairs on Monday, helped by firmer commodity prices and broad based US dollar weakness.
After finishing last week at .7105, the AUD/USD rose to as high as .7131 during the session before eventually closing at .7126. Modest gains were also seen across all other major pairs except the Canadian dollar which benefited from crude oil prices surging to new five-month highs.
Iron ore prices also helped to boost the Aussie with low and mid-tier grades both closing at fresh five-year highs on Monday.
More broadly, the main theme of the session was broad-based US dollar weakness. However, as for the reason why the greenback softened, there were plenty of possible explanations offered by analysts but no definitive answer.
Some put it down to a lift in risk aversion, although that doesn’t explain the buying in the safe-haven Japanese yen against the greenback during the session, while others said it may reflect adjustments to market positioning ahead of the release of several key central bank releases in the coming days.
Shayne ‘Jack’ Heffernan, CEO and Founder of Heffx, summed up the uncertainty behind the move in the US dollar nicely.
“‘Might’ is one of those weasel words often used to explain market moves that don’t have an underlying cause beyond the order-driven nature of markets, which is very much what we are in at the moment,” he said in his morning note. “Credit for trying though, please.”
Overall, the bias in prices is: Sideways.
The projected upper bound is: 0.72.
The projected lower bound is: 0.70.
The projected closing price is: 0.71.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 24 white candles and 25 black candles for a net of 1 black candles.
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 85.1145. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 16 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 56.45. 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 76 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 148.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 9 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 17 period(s) ago.
Rex Takasugi – TD Profile
FOREX AUD= closed up 0.002 at 0.714. Volume was 51% below average (consolidating) and Bollinger Bands were 63% narrower than normal.
Open High Low Close Volume___
0.713 0.715 0.712 0.714 50,834
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 0.71 0.71 0.72
Volatility: 7 9 10
Volume: 95,982 100,765 107,806
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 0.8% below its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of AUD= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on AUD= and have had this outlook for the last 10 periods.