Australian Dollar: USD/AUD (AUD=X) slips and risk markets soften as rally from Trump’s truce fades

Australian Dollar: USD/AUD (AUD=X) slips and risk markets soften as rally from Trump’s truce fades

Australian Dollar: USD/AUD (AUD=X) slips and risk markets soften as rally from Trump’s truce fades

The Australian Dollar slipped from recent highs Tuesday as risk-assets softened in the wake of a strong run at the beginning of the new week and as markets renew their focus on domestic drivers of the currency.  

Construction output figures for the final quarter are due to be released in the early hours of Wednesday morning while the business capital expenditures report for the same period will be published on Thursday morning, both of which will help analyst gauge the likely pace of growth toward year-end. 

The ebb and flow of economic growth will be important for the Aussie over the coming months given the Reserve Bank of Australia (RBA) recently warned that it could cut interest rates if the labour market or broader economy deteriorate in the months ahead.

“We expect Dec qtr construction work done to be unchanged, as higher engineering is offset by a step down in residential and non-residential construction. The dwelling and engineering outcomes are fed straight into Dec qtr GDP,” says Annette Beacher, head of Asia Pacific strategy at TD Securities.

This week’s data comes after President Donald Trump said on Monday that tariffs on Chinese goods imported into America will not rise any further next month, although analysts are already warning of “uncertainties” that could disrupt the newfound peace up ahead. 

The AUD/USD rate was quoted -0.25% lower at 0.7152 Tuesday and is now up 1.44% for 2019, although it had wracked up a 2.7% gain at one point in January. 

Overall, the bias in prices is: Sideways.

The projected upper bound is: 0.73.

The projected lower bound is: 0.70.

The projected closing price is: 0.71.

Candlesticks

A black body occurred (because prices closed lower than they opened).
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 25 white candles and 24 black candles for a net of 1 white 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 56.8345. This is not an overbought or oversold reading. The last signal was a sell 3 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 50.90. 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 46 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 98. This is not a topping or bottoming area. The last signal was a sell 0 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 5 period(s) ago.

Rex Takasugi – TD Profile

FOREX AUD= closed down -0.002 at 0.715. Volume was 57% below average (consolidating) and Bollinger Bands were 1% wider than normal.

Open High Low Close Volume___
0.717 0.717 0.714 0.715 48,380

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

Moving Averages: 10-period 50-period 200-period
Close: 0.71 0.71 0.73
Volatility: 9 11 11
Volume: 103,434 104,227 108,421

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 1.5% 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 9 periods.

The following two tabs change content below.
HEFFX has become one of Asia’s leading financial services companies with interests in Publishing, Private Equity, Capital Markets, Mining, Retail, Transport and Agriculture that span every continent of the world. Our clearing partners have unprecedented experience in Equities, Options, Forex and Commodities brokering, banking, physical metals dealing, floor brokering and trading.

You must be logged in to post comments :  
CONNECT WITH