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Australian Dollar: USD/AUD (AUD=X) needs to find support

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Australian Dollar: USD/AUD (AUD=X) needs to find support

The Australian dollar initially tried to rally during the trading session on Wednesday, slamming into the 0.69 level. This is an area that obviously will attract a lot of attention, but I think the 0.6850 level underneath is going to continue to be support, extending down to the 0.68 level after that. I believe that we won’t be able to break down below there unless of course the Federal Reserve decides not to cut interest rates, which is almost impossible to imagine at this point.

The downtrend line above of course continues to be a major barrier to overcome, so it’s not until we break above there that the longer-term “buy-and-hold” crowd can start to look at the Australian dollar seriously. Keep in mind that this pair does tend to move back and forth with the US/China trade situation as well, so that could have a bit of an effect also. Looking at this chart, we are oversold.

Overall, the bias in prices is: Downwards.

By the way, prices are vulnerable to a correction towards 0.70.

The projected upper bound is: 0.69.

The projected lower bound is: 0.68.

The projected closing price is: 0.68.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 1 white candles and 9 black candles for a net of 8 black candles. During the past 50 bars, there have been 23 white candles and 27 black candles for a net of 4 black candles.

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 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 4.7727. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 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 32.36. 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 52 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 -153.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 7 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 5 period(s) ago.

Rex Takasugi – TD Profile

FOREX AUD= closed down -0.003 at 0.684. Volume was 33% below average (neutral) and Bollinger Bands were 36% wider than normal.

Open     High      Low     Close     Volume___
0.687 0.690 0.683 0.684 54,773

Technical Outlook
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish

Moving Averages: 10-period     50-period     200-period
Close: 0.70 0.70 0.71
Volatility: 8 8 9
Volume: 52,237 73,354 97,522

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 3.5% 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 3 periods.

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