Australian Dollar: USD/AUD (AUD=X) lack of progress in the US-China trade talks seemed to cap attempted recovery

Australian Dollar: USD/AUD (AUD=X) lack of progress in the US-China trade talks seemed to cap attempted recovery

Australian Dollar: USD/AUD (AUD=X) lack of progress in the US-China trade talks seemed to cap attempted recovery

The AUD/USD pair quickly reversed an early European session dip to fresh 2-1/2 week lows and is currently placed at the top end of its daily trading range, around the 0.6925-30 region.

The pair stalled its recent downward trajectory and managed to find some support ahead of the 0.6900 handle in the wake of a modest US Dollar pullback from multi-week tops. Despite the fact that investors continue to scale back expectations for aggressive Fed rate cuts and a strong follow-through upsurge in the US Treasury bond yields, the greenback lost some upside momentum and was seen as one of the key factors behind the pair’s intraday rebound.

The uptick, however, lacked any strong follow-through as investors still seemed to refrain from buying the China-proxy Australian Dollar amid fading optimism over an early resolution to the prolonged US-China trade disputes. Hence, the bounce over the past hour or so could still be categorized as corrective in nature and attributed to some short-covering move ahead of Wednesday’s key event risks. 

All eyes remain glued to the Fed Chair Jerome Powell’s two-day semiannual testimony before the Congress, starting this Wednesday, which followed by the release of June FOMC meeting minutes will be closely scrutinized for fresh clues over the central bank’s near-term monetary policy outlook and eventually help determine the pair’s next leg of a directional move. 

Overall, the bias in prices is: Sideways.

The projected upper bound is: 0.70.

The projected lower bound is: 0.69.

The projected closing price is: 0.70.

Candlesticks

A white body occurred (because prices closed higher 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 24 white candles and 25 black candles for a net of 1 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 29.5166. This is not an overbought or oversold reading. The last signal was a buy 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 50.20. 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 38 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 -59. This is not a topping or bottoming area. The last signal was a sell 4 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 sell 2 period(s) ago.

Rex Takasugi – TD Profile

FOREX AUD= closed up 0.001 at 0.696. Volume was 100% below average (consolidating) and Bollinger Bands were 16% wider than normal.

Open High Low Close Volume___
0.696 0.696 0.695 0.696 385

Technical Outlook
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish

Moving Averages: 10-period     50-period     200-period
Close: 0.70 0.69 0.71
Volatility: 8 7 9
Volume: 62,526 83,529 101,491

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 1.8% below its 200-period moving average and is in an upward trend. Volatility is high as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume into AUD= (mildly bullish). Our trend forecasting oscillators are currently bullish on AUD= and have had this outlook for the last 13 periods.

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