TriumphFX Forex Analysis – AUD pairs – February 2020
AUDCAD – Daily and 4 Hour Charts
Price has been moving sideways on the daily time-frame. The moving averages have also been moving sideways and are tightening – confirming the current indecision. AUDCAD has formed a clear horizontal channel at 0.8845-0.9145.
On the 4 hour chart, price has been bearish and has been down-trending. The AUDCAD has formed a bearish channel. The moving averages are bearish and steady, signalling that the downside momentum could continue. Price may reverse around the daily horizontal channel support though and become bullish.
Selling opportunities may exist around the 4 hour dynamic resistance, bearish channel resistance and horizontal levels at 0.8950 and 0.8975. Buying opportunities may exist around the daily channel support at 0.8845, around the 4 hour support at 0.8865 and if AUDCAD closes above the 4 hour bearish channel resistance area.
The Bank of Canada (BOC) continues to raise interest rates at a steady pace. The current rate is 1.75% – it’s highest since December 2008. The economy is currently performing well and inflation targets are currently at their potential, meaning that the rate of 1.75% may not change in the near future. The Reserve Bank of Australia (RBA) cut rates again in their October 2019 meeting. Rates were cut by 0.25%, bringing the official bank rate to 0.75% (a record low). Rates have since stayed the same. The current low rate is needed to help reduce the unemployment rate and stimulate economy. The RBA will continue to monitor the labour market. It is likely that official rate will stay low and may even be cut further.
AUDCHF – Daily and 4 Hour Charts
On the daily time-frame, price has been down-trending in a large bearish channel. The moving averages are bearish and steady, signalling that the downtrend may continue.
Price is also down-trending on the 4 hour time-frame. AUDCHF is currently in a retrace phase. The moving averages are bearish and steady, signalling that the downward direction may continue. Price may retrace higher before attempting a bearish move.
Shorting opportunities could exist around the moving averages on both 4 hour and daily charts, around the daily bearish channel resistance area and around the horizontal levels at 0.6645, 0.6730 and 0.6825. A bearish move may stall or reverse around the 4 hour shorter-term moving average and around the horizontal levels at 0.6580, 0.6520, 0.6505 and 0.6435.
The Reserve Bank of Australia (RBA) cut rates again in their October 2019 meeting. Rates were cut by 0.25%, bringing the official bank rate to 0.75% (a record low). Rates have since stayed the same. The current low rate is needed to help reduce the unemployment rate and stimulate economy. The RBA will continue to monitor the labour market. It is likely that official rate will stay low and may even be cut further. The Swiss National Bank (SNB) continues to keep rates at the all-time low of -0.75%. The Swiss economy continues to be stagnant but has been showing signs of positive momentum. The Swiss Franc continues to be highly valued, especially due to the current global uncertainties around Brexit and the US. The SNB has announced that it will continue to intervene with in foreign exchange markets but will likely keep rates unchanged until at least 2021.
AUDJPY – Daily and 4 Hour Charts
The AUDJPY is moving within a daily bullish channel but is looking indecisive. The daily moving averages confirm the current indecision – they are tight and moving sideways. Price could be forming a horizontal channel at 71.85-76.40.
Price on the 4 hour charts is also looking indecisive. AUDJPY is currently ranging between the recent swing low at 73.10 and the horizontal resistance at 74.20.
Trading opportunities may exist around the support and resistance areas of the range and if price moves out of the range (break-out trade). A break to the downside could be rejected or reverse around the daily bullish channel support area and around the recent lows at 72.45. A break to the upside could be rejected or reverse around the 4 hour and daily moving averages and around the horizontal resistance levels at 76.15 and 76.40.
The Bank of Japan (BOJ) continues to keep interest rates at the record low of -0.10%. The Japanese economy is performing well and showing signs of expansion. The Reserve Bank of Australia (RBA) cut rates again in their October 2019 meeting. Rates were cut by 0.25%, bringing the official bank rate to 0.75% (a record low). Rates have since stayed the same. The current low rate is needed to help reduce the unemployment rate and stimulate economy. The RBA will continue to monitor the labour market. It is likely that official rate will stay low and may even be cut further.
AUDNZD – Daily and 4 Hour Charts
On the daily chart, price is moving within a large consolidation area – the AUDNZD is lacking trend direction. The moving averages are moving sideways and have been crossing frequently – confirming the market indecision. Price is forming a large triple-bottom, suggesting that AUDNZD may move higher.
Price is also looking choppy and indecisive on the 4 hour chart. The moving averages are once again moving sideways – confirming the indecision.
Trading opportunities could exist around the daily and 4 hourly moving averages and around any of the identified support and resistance areas.
The Reserve Bank of Australia (RBA) cut rates again in their October 2019 meeting. Rates were cut by 0.25%, bringing the official bank rate to 0.75% (a record low). Rates have since stayed the same. The current low rate is needed to help reduce the unemployment rate and stimulate economy. The RBA will continue to monitor the labour market. It is likely that official rate will stay low and may even be cut further. The Reserve Bank of New Zealand (RBNZ) continue to keep rates at the record low of 1.00%. Due to poor economic indicators, there are no forecast rate hikes in the near future but further cuts are currently being disregarded for the remainder of 2020. The US Federal Open Market Committee (FOMC) has cut rates by a further 25 points due to heightened concerns regarding the economy.
AUDUSD – Daily and 4 Hour Charts
AUDUSD has been clearly down-trending and is moving within a daily bearish channel. Price is currently struggling to reach the channel support area, suggesting that bearish momentum is weakening. The daily moving averages confirm this – they have become tight and are moving sideways. Price has recently been rejected at the previous daily support at 0.6765, signalling that bears are still entering the market, despite the recent lack of downside momentum.
On the 4 hour chart, the AUDUSD has become indecisive and is ranging between 0.6660 and 0.6760. The moving averages are bearish and widening, signalling that price could break lower.
Trading opportunities may exist around the support and resistance areas of the range and if the AUDUSD moves out of the range (break-out trade). Selling opportunities may exist around the moving averages. A break to the upside could find resistance around 0.6765, 0.6835 and 0.6930. A break to the downside could find support around the bearish channel support area.
The Reserve Bank of Australia (RBA) cut rates again in their October 2019 meeting. Rates were cut by 0.25%, bringing the official bank rate to 0.75% (a record low). Rates have since stayed the same. The current low rate is needed to help reduce the unemployment rate and stimulate economy. The RBA will continue to monitor the labour market. It is likely that official rate will stay low and may even be cut further. The US Federal Open Market Committee (FOMC) has cut rates by a further 25 points due to heightened concerns regarding the economy. The current Fed Funds rate is currently 1.75%. The current monetary plan is to keep the rate unchanged for the foreseeable future. There is some concern that keeping rates low could cause greater issues in the US’ financial sector. Overall, the US economy is performing well and inflation is at an acceptable rate.
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