Australian Dollar: USD/AUD (AUD=X) Upside Bias
The Australian Dollar inched lower on Friday, but still managed to close higher for the week. The Aussie continued to be supported by the Reserve Bank’s (RBA) optimistic outlook for the economy, but gains were likely capped by the strong U.S. economy and uncertainty over the economic impact of the coronavirus on China’s economy, Australia’s largest trading partner.
Daily Technical Analysis
The main trend is down according to the daily swing chart. The trend will change to up on a trade through the last main top at .6774. A move through .6662 will signal a resumption of the downtrend.
The minor trend is also down. Taking out .6750 will change the minor trend to up. This will also shift momentum to the upside.
The minor range is .6662 to .6750. Its 50% level at .6706 is acting like support.
The short-term range is .6774 to .6662. Its 50% level at .6718 is acting like resistance.
The intermediate range is .6934 to .6662. If the main trend changes to up then look for the rally to extend into the retracement zone at .6798 to .6830.
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
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 22 white candles and 25 black candles for a net of 3 black candles.
An engulfing bullish line occurred (where a white candle’s real body completely contains the previous black candle’s real body). The engulfing bullish pattern is bullish during a downtrend (which appears to be the case with FOREX AUD=). It then signifies that the momentum may be shifting from the bears to the bulls.
If the engulfing bullish pattern occurs during an uptrend, it may be a last engulfing top which indicates a top. The test to see if this is the case is if the next candle closes below the top of the current (white) candle’s real body.
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 62.5483. This is not an overbought or oversold reading. The last signal was a buy 9 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 40.71. 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 5 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 3. This is not a topping or bottoming area. 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 buy 3 period(s) ago.
Rex Takasugi – TD Profile
FOREX AUD= closed up 0.001 at 0.672. Volume was 97% below average (consolidating) and Bollinger Bands were 8% wider than normal.
Open High Low Close Volume___
0.671 0.673 0.671 0.672 1,331
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: 8 8 7
Volume: 48,929 48,233 61,739
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 1.9% 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 moderate flows of volume out of AUD= (mildly bearish). Our trend forecasting oscillators are currently bearish on AUD= and have had this outlook for the last 24 periods.
