Australian Dollar: USD/AUD (AUD=X) traders will looking for comments on the direction of interest rates
The Australian and New Zealand Dollars finished sharply lower last week. The selling pressure was driven by a sharp rise in U.S. Treasury yields and weaker-than-expected domestic data. Comments were mixed over U.S.-China trade relations. Fed Chairman Jerome Powell reiterated the central bank’s call for patience, while offering little insight into future monetary policy decisions. Traders did react to weaker-than-expected New Zealand Trade Balance data and a stronger-than-expected Gross Domestic Product report.
Last week, the AUD/USD settled at .7080, down 0.0048 or -0.68% and the NZD/USD finished at .6799, down 0.0051 or -0.74%.
Geopolitical events were watched last week, but had little effect on prices. Early in the week, President Trump announced he would delay the March 1 trade deadline for additional tariffs on Chinese goods as trade negotiations are progressing. Investors didn’t react much to the news as a delay was already assumed and priced in. Investors are waiting for more specific details from the trade agreement.
This week’s reports on concentrated in Australia and the United States. The week starts with the Australian Buildings Approvals report. It is expected to come in up 1.5%. The previous report was minus 8.1%.
On Tuesday, the Reserve Bank of Australia (RBA) will release its latest Rate Statement. This could be a market moving event if the central bank continues to move towards a rate cut. On Wednesday, RBA Governor Philip Lowe is scheduled to speak. Traders will looking for comments on the direction of interest rates. His speech will be followed by the release of the latest GDP report. It is expected to show the economy grew by 0.5%. On Thursday, investors will get the chance to react to the Retail Sales report. It is expected to show a 0.3% gain, up from the previously reported -0.4%.
On Friday, all eyes will be on the U.S. Non-Farm Payrolls report. Powell said the labor market is strong. This report is expected to show the economy added 185K jobs in February. The Unemployment Rate is expected to dip to 3.9% and Average Hourly Earnings are estimated to have risen by 0.3%, up from 0.1%.
Overall, the bias in prices is: Downwards.
The projected upper bound is: 0.72.
The projected lower bound is: 0.70.
The projected closing price is: 0.71.
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 24 white candles and 25 black candles for a net of 1 black candles.
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).
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 9.4985. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 7 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 42.78. 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 50 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 -113.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 3 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 1 period(s) ago.
Rex Takasugi – TD Profile
FOREX AUD= closed down -0.000 at 0.708. Volume was 54% below average (consolidating) and Bollinger Bands were 31% narrower than normal.
Open High Low Close Volume___
0.708 0.712 0.707 0.708 51,298
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 0.71 0.71 0.72
Volatility: 10 11 11
Volume: 105,116 103,576 108,381
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.
FOREX AUD= is currently 2.4% below its 200-period moving average and is in an downward 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 bearish on AUD= and have had this outlook for the last 13 periods.