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Australian Dollar: USD/AUD (AUD=X) Slight Upside Bias

Australian Dollar: USD/AUD (AUD=X) Slight Upside Bias

The Australian Dollar is trading higher on Monday, helped by thin volume due to the U.S. bank holiday and the announcement of fresh stimulus from China. Earlier in the session, China’s central bank cut the interest rate on its medium-term lending, a move expected to pave the way for a reduction in the benchmark loan prime rate on Thursday , to lower borrowing costs for companies hit by the virus.

In addition to the rate cut, China is planning targeted tax cuts while increasing government spending, Finance Minister Liu Kun wrote Sunday in China’s Communist Party magazine Qiushi. The move is designed to alleviate the shock of the virus outbreak on businesses.

Daily Technical Analysis

The main trend is down according to the daily swing chart. A trade through .6774 will change the main trend to up. A move through .6662 will signal a resumption of the downtrend.

The minor trend is also down. A trade through .6750 will change the minor trend to up. This will also shift momentum to the upside.

The first minor range is .6774 to .6662. Its 50% level at .6718 is new support. The second minor range is .6662 to .6750. Its 50% level at .6706 is additional support. Holding above these 50% levels will give the AUD/USD a slight upside bias.

Daily Technical Forecast

Based on the early price action and the current price at .6725, the direction of the AUD/USD the rest of the session on Monday is likely to be determined by trader reaction to the uptrending Gann angle at .6722.

Technical Indicators

Overall, the bias in prices is: Downwards.

By the way, prices are vulnerable to a correction towards 0.68.

The projected upper bound is: 0.68.

The projected lower bound is: 0.66.

The projected closing price is: 0.67.

Candlesticks

During the past 10 bars, there have been 5 white candles and 4 black candles for a net of 1 white candles. During the past 50 bars, there have been 22 white candles and 24 black candles for a net of 2 black candles.

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 47.3931. This is not an overbought or oversold reading. The last signal was a buy 10 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 38.69. 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 6 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 -9. This is not a topping or bottoming area. The last signal was a buy 5 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 4 period(s) ago.

Rex Takasugi – TD Profile

FOREX AUD= closed unchanged at 0.671. Volume was 99% below average (consolidating) and Bollinger Bands were 1% narrower than normal.

Open     High      Low     Close     Volume___
0.671 0.672 0.671 0.671 275
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 0.67 0.68 0.69
Volatility: 7 8 7
Volume: 46,569 48,091 61,491

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 2.0% 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 25 periods

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