AUD – xMetaMarkets.com / Online Innovative Trading Facility Tue, 02 Aug 2022 20:47:32 +0000 en-US hourly 1 https://wordpress.org/?v=6.6.1 /wp-content/uploads/2022/07/cropped-Logo-menu-32x32.png AUD – xMetaMarkets.com / 32 32 AUD Gives Up Gains at Resistance /2022/08/02/aud-gives-up-gains-at-resistance/ /2022/08/02/aud-gives-up-gains-at-resistance/#respond Tue, 02 Aug 2022 20:47:32 +0000 /2022/08/02/aud-gives-up-gains-at-resistance/ [ad_1]

We need to pay close attention to the global slowdown, because if we do in fact see a lot of slowing down out there, it will have a major negative effect on the Aussie.

  • The AUD/USD currency pair rallied significantly early on Monday but gave back quite a bit of the gains near the 0.7050 level.
  • That’s an area that has been important more than once, so it’s likely that we will continue the overall downturn.
  • Given enough time, I think that the Aussie will more likely than not break down below the 50-day EMA, and perhaps threaten the 0.69 level.
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Breaking Through 0.69

If the 0.69 level is broken to the downside, that could open up a significant amount of selling pressure. At the 0.68 level, we may see a little bit of hesitation, but the real support is at the 0.67 handle. The 0.67 handle is a major area of support on the longer-term charge, so if we were to break down below the 0.67 handle, then it’s likely that the market could flush much lower, showing signs of a massive capitulation. This is an area that has been important multiple times in the past, so I think it would trip off a flood of selling.

Alternatively, if we were to turn out and show signs of life, a break above the 0.7050 level could send this market much higher. At that point, we could go looking to the 200-day EMA, which is close to the 0.72 handle. The 0.72 handle is roughly where the 200-day EMA sits, so I think it makes quite a bit of sense that we would see it as a target, and perhaps even resistance as well. Having said that, if we were to break above that level, then it’s likely that the entire trend would change. Because of this, the buyers would almost certainly overwhelm the market at this time.

The market is highly sensitive to the 10 year yield, as it is a major driver of what happens with the greenback. Furthermore, we need to pay close attention to the global slowdown, because if we do in fact see a lot of slowing down out there, it will have a major negative effect on the Aussie, as it is highly sensitive to commodity markets. In a significant recession, commodity demand drops through the floor, and then has an effect on the Aussie as the Australian economy is so highly sensitive to commodity exports, as it is the supplier for Asia.

AUD/USD

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AUD Rallies to Form Double Bottom /2022/06/17/aud-rallies-to-form-double-bottom/ /2022/06/17/aud-rallies-to-form-double-bottom/#respond Fri, 17 Jun 2022 01:07:36 +0000 https://excaliburfxtrade.com/2022/06/17/aud-rallies-to-form-double-bottom/ [ad_1]

I will only add to positions once they prove themselves.

The Australian dollar rallied a bit on Wednesday to form a double-bottom pattern. Ultimately, the market has been hanging around the 0.6850 level. Looking at the start, we could rally significantly, but at this point, I think it’s only a matter of time before we see sellers come back in because this relief rally is probably just that, a relief rally.

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Looking at this chart, I think we have a lot of volatility ahead of us, and it’s also possible that we see a bit of a range form. Nonetheless, I think that’s probably the “best-case scenario” for Australia at the moment, as the Australian economy is suffering at the hands of China slowing down again, or perhaps I should say locking itself down, and potential concern when it comes to the demand for certain commodities.

The interest rate in America continues to climb, but now that we’ve had a little bit of a relief rally after the Federal Reserve raised to 75 basis points, any knock on effect of positivity is probably short-lived, and we will start to focus on the diversions of interest rates again. Inflation continues to run hot in the United States, and that is going to be a major problem. Granted, Australia does have a lot of a correlation between its currency and gold, but that is probably going to go by the wayside given enough time.

Look at this chart, if we were to break down below the recent low, that would be a very ugly turn of events. At that point, we go looking to the 0.68 level, and then perhaps open up a move down to the 0.66 level. On the upside, the 0.7250 level being broken could open up the possibility of the 0.75 level being targeted. The only thing I think you can count on in the Forex market right now is the fact that there is going to be a lot of volatility, so you need to keep your position size reasonable and recognizes that we are in a very unsettled environment as so much concern is found around the world when it comes to growth, inflation, and the recessions that are almost certainly coming down the road. I will only add to positions once they prove themselves.

AUD/USD

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AUD Drops as RBA is Considering Forex Market Intervention /2022/03/22/aud-drops-as-rba-is-considering-forex-market-intervention/ /2022/03/22/aud-drops-as-rba-is-considering-forex-market-intervention/#respond Tue, 22 Mar 2022 02:22:53 +0000 http://spotxe.com.test/2022/03/22/aud-drops-as-rba-is-considering-forex-market-intervention/ [ad_1]

On Wednesday, the  Australian Bureau of Statistics reported the preliminary retail sales figure, which showed that retail sales dropped by 4.2 percent (month-to-month) in September, after climbing by 3.2 percent on the previous month.

AUDLast week, the Australian Dollar went down by 3.59 percent against the US dollar, breaking a two-week gaining streak.

The Reserve Bank of Australia deputy governor Guy Debelle expressed his concerns about the value of the Australian dollar on Tuesday, going against the analysts’ expectations, who thought that he wasn’t going to comment on the issue given the belief that the Australian Dollar late performance has been mainly linked with the US dollar weakness. Last week the US dollar recovered against a bundle of its main competitors, gaining 1.85 percent and recovering from the previous week’s losses.

Debelle highlighted that a lower exchange rate would benefit the economy, which the markets interpreted as opening up the possibility of intervening in the foreign exchange market to lower the Australian Dollar value, something similar to what the Swiss National Bank has been doing to stop the appreciation of the Franc.

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The Deputy Governor also left the doors open for further interest rate cuts, which implies that the RBA eventually may consider imposing negative cash rates, though he pointed out that there is still room to bring down the cash rates without entering into the negative territory. About this alternative Debelle commented that the evidence is mixed concerning its effects on the exchange rate.

“The empirical evidence on negative rates is mixed. In the short-term, they can contribute to a lower exchange rate. In the medium term, the effectiveness can wane including through the effect on the financial system,” he said, adding that it can encourage households to save more, especially in an environment where they’re inclined to do so.

The Reserve Bank of Australia’s monetary policy committee is expected to meet next week and announce its monetary policy decision afterward. Until then, it may not be clear whether they’re willing to consider this alternative or not.

Last week the markets got important information about the state of the Australian economy. On Tuesday, the Commonwealth Bank of Australia together with market economics released the preliminary Commonwealth Bank Services PMI for September, which stood at 50, showing an expansion of the services sector. In August the indicator stood at 49, signaling a contraction in the sector, while the analysts foresaw it to be at 48.4. The Manufacturing PMI, which stood at 55.5, showed a faster expansion of the manufacturing sector, given the 53.6 of the previous month. Analysts foresaw a contraction, as they expected it to be at 48.3.

The composite PMI stood at 50.5, showing an expansion of the business sector. The previous month’s figure signaled a contraction, as it stood at 49.4. On Wednesday, the  Australian Bureau of Statistics reported the preliminary retail sales figure, which showed that retail sales dropped by 4.2 percent (month-to-month) in September, after climbing by 3.2 percent on the previous month.

On Friday, the Australian Bureau of Statistics published that the preliminary trade balance for August registered a surplus at $4,294 million, after being at $4607 million in the previous month. Imports fell by 7 percent after climbing 7 percent in July, while exports dropped by 2 percent after falling by 4 percent in the previous month.

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