Australian Dollar: USD/AUD (AUD=X) highlights this week
The RBA minutes were dovish, which was not a surprise, coming after the RBA cut rates from 1.50% to 1.25%. Policymakers said that it was “more likely than not” that further policy easing would be appropriate. On the housing front, the House Price Index plunged 3.0% in Q1, marking a fifth straight decline.In the U.S., the spotlight was on the Federal Reserve, which held its monthly policy meeting. FOMC members made no changes to rate levels, but hinted at a rate cut in 2020.
Will the Fed wait that long before pressing the rate trigger? It’s noteworthy that eight FOMC members favor a rate cut in 2019. The markets are prepared for a move later this year, with the CME Group pricing in a rate cut in September at 62%.
Tensions in the Persian Gulf are at a fever pitch, after Iran shot down a U.S. drone, which the U.S. claimed was in international airspace. President Trump ordered an airstrike against Iranian targets, but the mission was aborted close to the last minute. Investors are understandably nervous, as a wrong move by either side could ignite the Middle East.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 0.70.
The projected upper bound is: 0.70.
The projected lower bound is: 0.68.
The projected closing price is: 0.69.
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 22 white candles and 27 black candles for a net of 5 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.
Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.
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 73.9939. This is not an overbought or oversold reading. The last signal was a buy 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 47.77. 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 -18. This is not a topping or bottoming area. The last signal was a buy 2 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 5 period(s) ago.
Rex Takasugi – TD Profile
FOREX AUD= closed up 0.000 at 0.692. Volume was 6% below average (neutral) and Bollinger Bands were 11% narrower than normal.
Open High Low Close Volume___
0.692 0.694 0.690 0.692 88,755
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 0.69 0.70 0.71
Volatility: 7 7 9
Volume: 83,856 89,644 104,506
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 2.6% 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 volume flowing into and out of AUD= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on AUD= and have had this outlook for the last 2 periods.
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