Australian Dollar: USD/AUD (AUD=X) Powers Higher Again

Australian Dollar: USD/AUD (AUD=X) Powers Higher Again

Australian Dollar: USD/AUD (AUD=X) Powers Higher Again

The Australian dollar rallied a bit during the trading session on Monday, reaching towards the 0.70 level, a psychologically important figure to say the least. That being said though, although we have had a massive breakout to the upside it’s likely that we need a bit of a pullback in order to find enough value to put money to work. It would not be surprised at all to see that happen over the next couple of days, so now it’s simply a matter of waiting for value to present itself. I would anticipate that the 0.70 level could cause enough resistance to turn things around, perhaps dropping the pair down about 50 pips.

If we can get that 50 PIP drop, then I would be a willing buyer of the Australian dollar as it certainly looks as if we are changing the overall attitude. Furthermore, the 50 day EMA is starting to reach towards the upside and I think it’s only a matter of time before it breaks above the 200 day EMA, forming the “golden cross”, which of course is a figure that a lot of people will pay attention to. At this point, with New Year’s Day being on Wednesday it’s very likely that the market will be very difficult to get excited about, and at this point being patient will be very difficult as that “fear of missing out” comes into play. However, that’s a killer of small retail accounts, and it’s likely that you will get a better price to get involved in. I have no interest in shorting this market.

Technical Indicators

Overall, the bias in prices is: Upwards.

By the way, prices are vulnerable to a correction towards 0.69.

The projected upper bound is: 0.71.

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 7 white candles and 2 black candles for a net of 5 white candles. During the past 50 bars, there have been 25 white candles and 24 black candles for a net of 1 white 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 91.3535. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 16 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 72.11. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 102 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 178.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 9 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 19 period(s) ago.

Rex Takasugi – TD Profile

FOREX AUD= closed up 0.002 at 0.700. Volume was 14% below average (neutral) and Bollinger Bands were 16% wider than normal.

Open     High      Low     Close     Volume___
0.698 0.701 0.697 0.700 46,680
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 0.69 0.69 0.69
Volatility: 5 7 7
Volume: 38,087 45,893 69,232

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 1.4% above its 200-period moving average and is in an upward trend. Volatility is low 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 bullish on AUD= and have had this outlook for the last 11 periods. Our momentum oscillator is currently indicating that AUD= is currently in an overbought condition.

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