Australian Dollar: USD/AUD (AUD=X) from bearish to bullish

Australian Dollar: USD/AUD (AUD=X) from bearish to bullish

Australian Dollar: USD/AUD (AUD=X) from bearish to bullish

On Sep 3, AUD/USD declined to 0.6687- its lowest level in five weeks. However, in the following days the pair rallied and closed the weekly candlestick with nearly 1.7% gain. On the other hand, NZD/USD started to trade higher on Sep 4 then closed on Friday in the green with 1.8% gain.

On Friday, the Relative Strength Index (RSI) climbed to 60 on AUDUSD then remained flat after, indicating to a fading uptrend momentum. Similarly, the oscillator climbed to 51 then remained flat highlighting the same case for NZDUSD.

Looking at the daily chart, we notice on Friday AUD/USD rallied to a higher trading zone 0.6826 – 0.6904 eyeing a test of the high end of this zone.

Hence, a close above the high end of the zone could push AUDUSD towards 0.6984. However, the weekly resistance levels underscored on the chart (zoomed in) need to be considered. Further close above 0.6984 may lead the price towards 0.7082. In that scenario, the weekly resistance levels underlined on the chart need to be watched along the way.

On the flip-side, any failure in closing above the high end of the zone could reverse the pair’s direction and send it towards the low end. Further close below the low end might press AUDUSD towards 0.6744. However, the weekly support level and area marked on the chart would be worth monitoring.

Technical Indicators

Overall, the bias in prices is: Sideways.

The projected upper bound is: 0.69.

The projected lower bound is: 0.68.

The projected closing price is: 0.69.

Candlesticks

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 20 white candles and 30 black candles for a net of 10 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 Indicators

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.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 88.2204. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 25 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 59.93. 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 24 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 114.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 6 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 18 period(s) ago.

Rex Takasugi – TD Profile

FOREX AUD= closed up 0.000 at 0.686. Volume was 99% below average (consolidating) and Bollinger Bands were 13% narrower than normal.

Open     High      Low     Close     Volume___
0.686 0.686 0.686 0.686 699
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 0.68 0.69 0.70
Volatility: 6 8 9
Volume: 65,362 66,385 90,179

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.

Summary

FOREX AUD= is currently 2.2% below its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. 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 3 periods. The security price has set a new 14-period high while our momentum oscillator has not. This is a bearish divergence.

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