FXEMPIRE
All
Ad
Corona Virus
Stay Safe, FollowGuidance
World
60,123,638Confirmed
1,415,192Deaths
41,567,286Recovered
Fetching Location Data…
Advertisement
Advertisement
James Hyerczyk
AUD/USD Australian Dollar

The Australian Dollar closed slightly lower on Friday as the currency rebounded from an earlier test of the low of the year as news of slower U.S. payrolls growth in July fueled expectations that the Federal Reserve would cut interest rates again in September. Gains were likely capped by heightened U.S.-China trade tensions that drove down demand for commodity-linked currencies.

On Friday, the AUD/USD settled at .6801, down 0.0001 or 0.02%. This was up from an intraday low of .6763. The previous low of the year was .6764, hit on July 3, 2019.

Daily AUD/USD Swing Chart

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through .6763 will signal a resumption of the downtrend. The daily chart is wide open under this level with the next major bottom the March 3, 2009 main bottom at .6285. This is followed by the February 2, 2009 main bottom at .6247. The November 20, 2008 main bottom at .6074 and the October 27, 2008 main bottom at .6008.

Friday’s price action suggests that aggressive counter-trend buyers were trying to form a closing price reversal bottom, but fell short at the close. This doesn’t mean the trend is getting ready to turn to up, but there is the possibility of a short-term shift in momentum to the upside.

The current short-term range is .7082 to .6763. If the market is able to generate enough upside momentum over the near-term, we could see an eventual rally into its retracement zone at .6923 to .6960.

Advertisement

Daily Swing Chart Technical Forecast

The offsetting fundamentals are making a forecast difficult. Furthermore, the hedge funds are net short and looking for more downside especially since there is no real support under .6764 until .6285 to .6008.

On the bearish side, the Reserve Bank of Australia (RBA) is expected to cut rates in October, however, before that, the Federal Reserve is widely expected to cut rates again in September. Additionally, the new tariffs on China are expected to kick in on September and traders are still waiting for countermeasures by China.

The first sign that the selling is getting weaker will be a move through .6819. This will make .6763 a new minor bottom. This move will not necessarily mean that new buyers are driving the price action. In fact, we anticipate that there are a lot of shorts that have to be cleared out before real buyers will emerge.

We’re looking to play momentum on Monday with an upside bias expected to form on a sustained move over .6819 and the downside bias to continue on a sustained move under .6763.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker

  • Your capital is at risk
IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US