Australian Dollar: USD/AUD (AUD=X) RBA revealed the Board was mindful that rates were already low

Australian Dollar: USD/AUD (AUD=X) RBA revealed the Board was mindful that rates were already low

Australian Dollar: USD/AUD (AUD=X) RBA revealed the Board was mindful that rates were already low

The Reserve Bank of Australia (RBA) minutes from its monetary policy meeting on November 5, revealed the Board was mindful that rates were already low and that each further cut brings closer the point at which other policy options come into play.

Traders read the summary to mean the central bank might stand on the sideline for some time. However, the minutes revealed that the members remained concerned about sluggish economic developments despite previous rate cuts.

Traders will be keeping an eye on news regarding the progress of U.S.-China trade talks, but low U.S. holiday volume is likely to hold Aussie and Kiwi prices in a tight trading range.

Despite a week filled with a slew of negative headlines regarding U.S.-China trade relations, in my opinion, the only ones to be concerned about are the positive comments at the end of the week.

Furthermore, on Thursday, Gao Feng, China’s Ministry of Commerce spokesman said, “external rumors” about trade talks are not accurate, and noted the two trade delegations remain in close communication.

Shortly afterwards, there was a report that China invited the U.S. trade delegation to Beijing for face-to-face talks. President Trump then told Fox News both sides were “very close,” and Chinese President Xi Jinping told a visiting U.S. business delegation that China holds a “positive attitude” toward the trade talks.

Aussie traders are likely to react to comments from RBA Governor Philip Lowe on Tuesday, a Construction Work Done report on Wednesday and a Private Capital Expenditure report on Thursday.

Kiwi traders will be watching a speech by RBNZ Governor Orr on Wednesday and a report on ANZ Business Confidence on Thursday.

Technical Indicators

Overall, the bias in prices is: Sideways.

The projected upper bound is: 0.69.

The projected lower bound is: 0.67.

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 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 22 white candles and 27 black candles for a net of 5 black candles.

Separating lines occurred. If the lines occur during an uptrend and the first line is black and the second is white (which is not the case with FOREX AUD=) then this suggests that the uptrend should continue.

If the separating lines occur during a downtrend (which appears to be the case with FOREX AUD=) and the first line is white and the second is black (which is the case with FOREX AUD=) then this suggests that the downtrend should continue.

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 13.7363. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a buy 6 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 40.30. 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 77 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 -101.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 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 11 period(s) ago.

Rex Takasugi – TD Profile

FOREX AUD= closed down -0.001 at 0.678. Volume was 37% below average (neutral) and Bollinger Bands were 15% narrower than normal.

Open     High      Low     Close     Volume___
0.678 0.680 0.677 0.678 38,522
Technical Outlook 
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 0.68 0.68 0.69
Volatility: 6 7 8
Volume: 45,547 54,701 76,701

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 2.2% below its 200-period moving average and is in an downward trend. Volatility is relatively normal 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. The security price has set a new 14-period low while our momentum oscillator has not. This is a bullish divergence.

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