AUDUSD – January 20th 2014

The Australian Dollar took a big hit last week after the employment report disappointed, but I think we are in for a short-covering rally and a breakout above 0.9000 could open the way up for much larger gains. Before you nod in agreement this is a contrarian view as the majority expects the Aussie to lose value in 2014 and drift lower. Looking at the charts there is a clear rally in the making, at least according to my view on it. See for yourself and see what you can come up with.

I looked at this Pair myself. I never buy in a downtrend so I’ll wait for the next top.

There is diversion on the CCI confirmed on a few other oscillators as well so definitely a Bull move ahead to about 0.8954 area but I don’t think it will break the regression channel or go above the 55 slow moving average. In my opinion the Downtrend is solid, even the Parabolic SAR is saying the bears are in control another down wave ahead. 3 Bull days at best.

That being said it is on the high side of its mean in the channel, so we will see if it breaks not with the solid fundamentals out of the US with this tapering and all. It is a looker though…

Any thoughts on the Aus cpi coming up this week?

Expected is at 0.5 …

Also the NZD data out very soon - will be interesting.

The CPI may be the reason buying interest has resumed not enough to move those bear stops.

The news is discounted so the bulls are already locked in…

I suspect higher than 0.5
The higher the number …

The little rally was on the back of the GDP q/y numbers from China, so let’s see what NZD produces :slight_smile:

There you go, the higher the number …good old NZD :slight_smile:

Higher import prices last qtr, higher producer prices last qtr - unlikely a drop in cpi this qtr.

It is a pair I scanned just today. I trade only EUR/USD unless some other pair offers great odds. Thanks for the insight Peterma on those fundamentals. The charts show a Downtrend but I never “eat heads or tails” so I am waiting for a new top on that pair and move down to see if the trend continues down and go short.

I will have a brief snap on the fundamental data during the London session and get my facts straight.
:slight_smile:

Yes, the rally was on the back of Chinese data and I think the CPI will come in above 0.5.

Yes, maybe higher although as Emerald says Aussie is on a downtrend, it’ll take a really big jump to sustain a change there. The NZD was much easier, anything positive did the job, maybe now a rate increase in March for you guys?

I often judge the level of uncertainty in fundamentals, the greater the uncertainty the more price is held back, as this level of uncertainty decreases so then price reacts… the NZD cpi helped lower the uncertainty about a rate hike and it’s timing, thus price reacted positively.

It is this level of uncertainty that cannot be “already priced into price”.

One recent example springs to mind - everyone was saying that taper was already priced into the USD, all were expecting an announcement, when it was finally announced USD reacted positively - reason being that uncertainty had just been reduced.

USD took ages to gain momentum especially when every other major economy was in an easing program or hell bent on devaluing. Like JPY…

Suspect Bernanke was creating uncertainty to prevent excessive Dollar demand too early.

Valid point, Central bankers are very aware of their currency rates and have many tricks at their disposal.

I know it’s kinda off topic but US news light today - IMF Chief Lagarde may impart a little impetus into cable later, maybe add to that bull flag?

Update: the little impetus was worth 50 pips - the ‘news’ was well known and reported yesterday, yet it still impacted on cable, confirms what I was saying about removal of uncertainty :slight_smile:

The figure has come out at 0.8 - a lot higher than expected, although we expected it - for the same reasons as given ref the Kiwi.

The consequent jump was worth 70 pips, whether that will remain sustained or not is another thing.

Now to GBP (must start a new thread on this stuff) - unemployment - expected at 7.3%, down from 7.4%

Employment in UK has a strong services base, this number could be a hit or on the lower side, suspect a bullish reaction, maybe from 6480 - let’s see.

There you go, bullish GBP, worth 70pips.

That’s me finished, was not trying to show off, was just showing how it’s possible to achieve a correct bias on a currency before the release of a news item.

( lol, it feels like I’m talking to myself :))

I was referring to The Aussie and the jump of 70 pips on the higher cpi.

Note that the rise was NOT sustained, we are back to where we were, so if you had decided to get even more than the 70 pips - now back at b/e or under water.

A rate hike is on the horizon and we may see on in the first half depending on how eco-data comes in. By the same token I doubt another rate cut by the RBA.

Technical Analysis of AUD/USD Dates 2014.12.16

AUD/USD was in a strong and consistent downtrend during the recent weeks that sellers were successful in obtaining the lowest price of 0.82000. price with reaching to the supportive level which is shown in the picture below ( made of 4 bottom prices) and the important round level of 0.82000 has stopped from more descend( sellers used this level to exit their trades) and with formation of a bottom price in H4 time frame has prepared a field for ascending of price.

As it is obvious in the picture below, between the top price of 0.87957 and bottom price of 0.82009 there is ABC harmonic pattern with ratio 2.24 that warns the potential of ascending from the C point of this pattern.RSI indicator is in saturation sell area in daily and H4 time frame that confirms the harmonic C point and warns about changing price direction during the next candles.Generally until the bottom price of 0.82009 is preserved, the price has the potential for ascending in this currency pair.