Australian Dollar: USD/AUD (AUD=X) Looking to Continue Grinding Higher

Australian Dollar: USD/AUD (AUD=X) Looking to Continue Grinding Higher

Australian Dollar: USD/AUD (AUD=X) Looking to Continue Grinding Higher

The Australian dollar initially pulled back a bit during the trading session on Monday, but then turned around to reach towards the top of the range from the previous session almost immediately during the US session. Keep in mind that several banks around the world were closed due to Easter Monday, so the liquidity could have been a bit of an influence. If we can break above the 50 day EMA to the upside, the market is likely to go looking towards the 0.65 handle after that. Obviously, the 0.65 level is an area that will attract a certain amount of attention due to the fact that it is a large, round, psychologically significant figure.

To the downside, if we were to break down below the bottom of the range for the Friday session, then we could get a pull back towards the 0.62 level, maybe even the 0.60 level after that. All things being equal, the market is trying to figure out whether or not we have the “all clear” for risk appetite. The market participants continue to see a lot of back and forth due to the Federal Reserve throwing so much money into the market, and a decision to be made whether or not this is a good sign or not going forward. The US dollar has gotten hit a little bit due to the fact of the quantitative easing, but one has to wonder whether or not there is any global growth going forward, which of course will have a detrimental effect on this pair.

Technical Indicators

Overall, the bias in prices is: Upwards.

The projected upper bound is: 0.66.

The projected lower bound is: 0.62.

The projected closing price is: 0.64.

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 25 white candles and 25 black candles.

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 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 94.7726. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 9 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 62.23. 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 15 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 147.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 15 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 12 period(s) ago.

Rex Takasugi – TD Profile

FOREX AUD= closed up 0.004 at 0.642. Volume was 69% below average (consolidating) and Bollinger Bands were 91% wider than normal.

Open     High      Low     Close     Volume___
0.638 0.643 0.637 0.642 22,167
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 0.62 0.64 0.67
Volatility: 18 22 13
Volume: 106,877 90,873 65,103

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 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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