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AUD/USD

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AUDUSD Still just chopping sideways but becoming more interesting..
 

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AUDUSD remains crucially poised at key support at .9336/22 – the 55-day average and mid-June low. Although this is holding for now, a break would see a top complete, as well as a confirmed break of the uptrend, clearing the way for further weakness to .9258, then what I view as more important support at .9230/.9202. Failure to hold this latter area would mark the completion of a much larger and more significant top, warning of a resumption of the medium-term bear trend. Above .9383 is needed to ease the immediate downside bias for .9413/18. Extension through .9450 is needed to reassert an upward bias for a move back to .9506, ahead of .9584 ‒ the 38.2% retracement of the entire 2011/2014 downtrend.
Trade Idea: Long, stop/reverse below .9320, for.9580.
 
AUDUSD remains poised at key support at .9337/22 – the 55- day average and mid-June low. Although this is holding for now, a break below it would see a top complete, as well as a confirmed break of the uptrend, clearing the way for further weakness to .9258, then what I view as more important support at .9230/.9202. Failure to hold this latter area would mark the completion of a much larger and more significant top, warning of a resumption of the medium-term bear trend. Resistance is seen at .9396, then .9413/18. Extension through .9450 is needed to reassert an upward bias for a move back to .9506, ahead of .9584 ‒ the 38.2% retracement of the entire 2011/2014 downtrend.
Trade Idea: Long, stop/reverse below .9320, for.9580.
 
As it was mentioned in the previous technical analysis of AUD/USD pair dated 2014.04.29, according to the formed signs, there was a potential for ascending of price which finally happened .Buyers were successful in reaching to the highest price of 0.95000.In weekly time frame of this currency pair there is no clear reason for ascending of the price and the price by being under the 5-day moving average and also descending cycle of Stoch indicator warns more descending of next candles .According to the formed price movements, RSI indicator is in saturation buy area and in divergence mode with the price chart that confirms the top price of 0.95000 and warns about changing price direction.
Currently one of the important warnings for starting the price downfall is breaking the support level of 0.93281 in daily time frame because As it is obvious in the picture below, there is an AB=CD harmonic pattern between the top price of 0.94551 and the bottom price of 0.933281 with ratios of 50 to 161.8 that warns about ascending of price from the D point of this pattern.

Technical Analysis of AUD/USD dated 2014.07.16
 
any explanation with the fall of the AUD overnight?
i would have thought the Fed stating they will not rise the rate in a hurry could have seen the USD go lower instead; or is it just no one believes the Fed and just look at the so called better US figures?
 

USD rose against majors. The strength occurred following the strong headline print for Q2 Advanced GDP. The USD steadied and slightly weakened into the FOMC release, but not enough to give back the gains following the GDP print.
 

Advanced GDP print was strong and also in detail. Remarkable turnaround from Q1 and lending credence to the view that the economy was sideswiped by weather rather than underlying developments. Everything was up in key categories, except imports (which rose, but this subtracts from GDP). The detail does not really suggest an overshoot beyond a recovery from Q1.

This result is in-line with wide ranged comments from the Beige Book and is also reflective of improving consumer sentiment.

There is evidence that things are looking alright for the US off a low base.
 
qldfrog said:
the Fed stating they will not rise the rate in a hurry
Click to expand...

Interesting development in FOMC with Narayana Kocherlakota (Minneapolis Fed) dissenting on final wording on the basis that it does not offer an adequate reflection of the economic recovery. This guy is independently minded about a fair number of things and will dissent, but this is interesting anyway in that the bias towards monetary tightening seems to have increased.

Reading through the Fed minutes, I find it interesting that there is considerable slack in the labour markets with limited pricing power there, a point made clear in other surveillance, but inflation is climbing back towards targets already. Without significant labour productivity growth, which doesn't tend to happen when labour is being added, we are looking at deliberate inflation generation beyond long term targets and real yields being held down.

Ordinarily, you'd expect that the USD would strengthen into such an event. However, the Fed action and debt overhang at the federal level and also personal level argues for lower than usual real rates. On balance, corporates still have a lot of cash on balance sheet, are increasing it as % of assets, and returning a ton of cash to shareholders. This will limit the need to borrow for expansion on a net basis for a while.

Overall, this argues for a lesser response from an economic recovery in relation to a strengthening USD than a more pedestrian recovery might imply.
 
kid hustlr said:
RY are you actually retired young or just a good broker?
Click to expand...

Hi Kid

I retired a bit after 40. I was a fund manager back in the day doing funky stuff. Never was a broker. Now managing our portfolio and washing dishes. Collecting the kids in 20 minutes. And need to figure out why a pile of stock which I just sold does not appear on my systems...

Cheers

RY
 

Ta mate. explains a lot. You were just way too smart to be a broker and fund managers wouldnt be typing on an internet forum
 
No change leaves AUDUSD short-term rangebound. While .9289/91 caps the immediate risk can stay lower to retest support at .9240/02 – the series of lows from April and May, next. While I would expect this to hold for now for a rebound, capitulation below here can set a much larger top, to target the 200-day average and 38.2% retracement of January/July rally at .9182/76 initially. I would expect this to hold for an initial bounce, ahead of another leg of weakness towards .9082. Above .9291 can complete a minor base for a recovery back to .9323/28. Above .9375 is needed to ease the downside bias.
Strategy: Short, stop above .9390, for .9240.
 
The AUSSIE confirmed a weak closing last night below the low of the previous session. A closing tonight below 0,9275 will confirm a top for the AUSSIE suggesting a drop toward the 200 days lien at 0,9178!! The indicators of the daily chart are still well negative as well as those of the s/t charts supporting further weakness. The drop favoured the retest of the previous bottom made this month failing to make a lower low, even in the hourly closing. In the s/t I see a possible retest of the 200 hours line at 0,9299 where I expect however strong resistance. However while below this line the scenery will remain negative. I prefer staying still on the side line!
 
The AUSSIE confirmed a negative closing on Friday while remaining interior the previous day’s range forming a new inside day with 0,9390 – 0,9315 the levels to follow in the coming hours! The closing was again below the 100 days line! The weekly closing was positive as well as the monthly one where it even failed to confirm the previous months’ negative month reversal.
The indicators of the daily chart are still well positive as well as those of the weekly one but the indicators of the monthly chart are negative. The indicators of the s/t charts are mixed today suggesting some consolidation. However, while above the 200 hours line at 0,9320 we expect the AUSSIE to move higher toward a possible target at 0,9382!!
We stay on the sideline following the inside day!
 
The pair confirmed a weak closing last night but it is already recovering all what it made yesterday on the downside. A closing at the present levels will confirm a positive outside day suggesting a retest of the 0,9375 level that could be the neck line of a reversed S_H_S formation with a double head or a double bottom!! The indicators of the daily chart are already returning above the line and of course also those of the s/t ones are positive suggesting higher levels. In the hourly chart we have however overbought conditions after having formed bullish divergences on the way down. An hourly closing above 0,9366 will however abort the negative reversals already re-launching the move up! We stay on the side line waiting for confirmations!
 
The pair confirmed a positive closing last night but it failed to confirm the move above 0,9375 and even that above the 55 days line at 0,9356. However, while above the 0,9340 level we expect the AUSSIE to try further on the upside!! The indicators of the daily chart are still well positive for now while those of the s/t charts are showing a mixed picture suggesting some consolidation/ correction. However, only a break below 0,9330 will support a deeper correction; while above we favour a 0,9400 overshooting!!
 
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