Australian Dollar: USD/AUD (AUD=X) will Resist Further Downside Pressure

Australian Dollar: USD/AUD (AUD=X) will Resist Further Downside Pressure

Australian Dollar: USD/AUD (AUD=X) will Resist Further Downside Pressure

Forecasts from analysts at the world’s largest FX dealer, Citibank, suggest the Aussie is likely to resist further downside pressure during the months ahead.

The findings are published here as the Australian Dollar suffers a bout of selling owing to another salvo in the global trade war being fired at China by the United States who are readying another round of tariffs on Chinese goods worth $200BN.

The Australian Dollar is clearly more attuned to global drivers than domestic; the falls come despite a surprsise increase in the number of new home loans approved during May. Housing is a ‘hot button’ issue in Australia at the moment given falling sales activity in key urban centres like Melbourne and Sydney as well as chatter over a downturn in the market.

Overall, the bias in prices is: Downwards.

The projected upper bound is: 0.75.

The projected lower bound is: 0.72.

The projected closing price is: 0.74.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 21 white candles and 29 black candles for a net of 8 black candles.

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 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 28.5336. This is not an overbought or oversold reading. The last signal was a sell 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 41.25. 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 -71. This is not a topping or bottoming area. The last signal was a sell 1 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 6 period(s) ago.

Rex Takasugi – TD Profile

FOREX AUD= closed down -0.000 at 0.736. Volume was 98% below average (consolidating) and Bollinger Bands were 43% narrower than normal.

Open High Low Close Volume___
0.737 0.737 0.736 0.736 1,756

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

Moving Averages: 10-period 50-period 200-period
Close: 0.74 0.75 0.77
Volatility: 12 10 9
Volume: 93,784 100,495 90,388

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 4.2% below its 200-period moving average and is in an downward trend. Volatility is relatively normal 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 17 periods.

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