Australian Dollar: USD/AUD (AUD=X) global relief rally saw traders pour back into riskier assets
The Australian Dollar lived up to its reputation as the risk-proxy of choice for traders during this trade war, selling off to as low as 0.7150 in the lead-up to US President Trump’s announcement of the latest round of US tariffs on Chinese goods, and bouncing off that level to rally over 2 per cent to touch as high as 0.7302 in the days following it. The rally in the AUD/USD was sufficient enough to propel the pair to the top its downward trend channel, prompting traders to fade the rally and take profit.
Though sentiment isn’t as dour as it was at the beginning of last week, the inflammation of US-China trade tensions over the weekend, coupled with the US Federal Reserve’s policy meeting on Thursday (AEST), will weigh on the Aussie, with IG traders increasing their short positions on the currency of the past 24 hours. Given perceptions of Australian fundamentals haven’t shifted in the past fortnight, the fortunes of the AUD/USD will rest on global risk appetite, as well as the affect the Fed has on USD strength this week.
Overall, the bias in prices is: Downwards.
The projected upper bound is: 0.74.
The projected lower bound is: 0.71.
The projected closing price is: 0.72.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 26 white candles and 24 black candles for a net of 2 white 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.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
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 50.3047. This is not an overbought or oversold reading. The last signal was a sell 1 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 50.26. 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 100 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 60. This is not a topping or bottoming area. The last signal was a sell 1 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 7 period(s) ago.
Rex Takasugi – TD Profile
FOREX AUD= closed down -0.000 at 0.725. Volume was 94% below average (consolidating) and Bollinger Bands were 5% narrower than normal.
Open High Low Close Volume___
0.725 0.725 0.724 0.725 6,127
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 0.72 0.73 0.76
Volatility: 8 11 10
Volume: 93,187 101,413 98,237
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 4.5% 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.
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