Australian Dollar: USD/AUD (AUD=X) market sentiment has been boosted over the past 24 hours by some more encouraging news on US-China trade negotiations
The Australian dollar rebounded from six-week lows on Tuesday as the rally in the greenback fizzled.
Optimism towards a potential trade deal between the US and China, so often seen whenever high-level trade talks are about to resume, was cited as the catalyst.
As has been the case for the past 10 session, the main theme of the session was the US dollar. However, having rallied in each of the previous nine sessions, this time it weakness in the US dollar index (DXY), rather than strength, that was the story on Tuesday.
Hopes for a trade deal between the US and China, or at least an extension to the hard deadline of March 1 when higher US tariffs are scheduled to begin, helped to lift stocks and Asian currencies, including the Aussie dollar.
“Market sentiment has been boosted over the past 24 hours by some more encouraging news on US-China trade negotiations,” said David de Garis, Economist at the National Australia Bank.
“White House press advisor Kellyanne Conway told Fox News that Trump ‘wants to meet with President Xi very soon’ while Trumnp added at a campaign rally that ‘we don’t want China to have a hard time’.
Adding further fuel to the rally in risk assets, Trump also hinted that he may be prepared to extend the deadline when higher tariffs may kick in.
Overall, the bias in prices is: Sideways.
By the way, prices are vulnerable to a correction towards 0.72.
The projected upper bound is: 0.72.
The projected lower bound is: 0.70.
The projected closing price is: 0.71.
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 24 white candles and 25 black candles for a net of 1 black candles.
An inverted hammer occurred. If this occurs during a downtrend (which appears to be the case with FOREX AUD=) it implies a reversal. Look for a confirmation of the reversal on the bar.
A long upper shadow occurred. This is typically a bearish signal (particularly when it occurs near a high price level, at resistance level, or when the security is overbought).
A shooting star occurred (a shooting star has a small real body near the bottom of the candle and a long upper shadow). During an uptrend the long upper shadow indicates that the bears are gaining control and a top may occur.
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 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 18.6094. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 7 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 43.75. 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 37 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 -65. This is not a topping or bottoming area. The last signal was a buy 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 sell 4 period(s) ago.
Rex Takasugi – TD Profile
FOREX AUD= closed up 0.000 at 0.710. Volume was 14% below average (neutral) and Bollinger Bands were 2% narrower than normal.
Open High Low Close Volume___
0.709 0.714 0.709 0.710 98,200
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 0.72 0.71 0.73
Volatility: 12 11 11
Volume: 99,643 107,531 108,335
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 2.5% below its 200-period moving average and is in an downward trend. Volatility is high 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 0 periods.
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