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Australian Dollar: USD/AUD (AUD=X) Sellers Drive into Support

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Australian Dollar: USD/AUD (AUD=X) Sellers Drive into Support

The late-Q3 impasse in the US Dollar continues to hold as the Greenback remains in a range despite a number of big drivers showing over the last couple of weeks. The European Central Bank rate decision and announcement of stimulus was unable to do it, as was the FOMC rate cut last week, and USD price action continues to trade within a rather tight band just underneath the fresh two-year-highs that were created earlier this month.

Next quarter looks to be particularly interesting: Will we have a repeat of the 2018 Q4 risk aversion theme, where US equities dipped by as much as 20% ahead of the Christmas holiday? Or, will the Fed take on a softer tone, helping to provide a boost of support across global markets? Given the two rate cuts that we’ve already had that answer might seem simple but, at this point, the FOMC hasn’t yet tipped their hand, which is likely leading into the build of this range ahead of the Q4 open.

Despite this seeming lack of near-term direction, the US Dollar has shown a rather clear recent trend against the Australian Dollar, threatening to push the pair further down for a test of the fresh decade lows that were set in early-August trade.

Technical Indicators

Overall, the bias in prices is: Downwards.

The projected upper bound is: 0.68.

The projected lower bound is: 0.67.

The projected closing price is: 0.67.

Candlesticks

During the past 10 bars, there have been 3 white candles and 5 black candles for a net of 2 black candles. During the past 50 bars, there have been 19 white candles and 29 black candles for a net of 10 black candles.

A doji star occurred (where a doji gaps above or below the previous candle). This often signals a reversal with confirmation occurring on the next 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).

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 24.5550. This is not an overbought or oversold reading. The last signal was a buy 1 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 39.24. 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 35 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 -118.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 2 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 4 period(s) ago.

Rex Takasugi – TD Profile

FOREX AUD= closed down -0.000 at 0.675. Volume was 98% below average (consolidating) and Bollinger Bands were 1% wider than normal.

Open     High      Low     Close     Volume___
0.675 0.676 0.675 0.675 1,475
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 0.68 0.68 0.70
Volatility: 6 7 9
Volume: 59,666 67,495 87,089

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 upward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. 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 14 periods.

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