Market Outlook

AUDUSD weekly report 30 Dec 2019 to 03 Jan 2020


Weekly Idea: – Positional Call:-

Buy near 0.6925, Stop loss below 0.6860, target- 0.7075

1- Technical Views- AUD/USD Daily outlook

The AUD/USD pair has moved higher over the last couple of sessions. The resistance level of 0.69300 has been taken out and could be the support level on the lower timeframes. There is a rising wedge pattern marked in red on the chart. The top of the pattern could halt the price. Also, be aware that the price is pretty close to the psychological 0.70 zones.

AUDUSD surged to a 5-month high of 0.6954 on Friday as the pair looked set to post a seventh straight session of gains. However, although the technical indicators suggest there’s plenty of positive momentum remaining to sustain the rally, there are some signs that the pair is in danger of becoming overbought.

The RSI continues to rise and has yet to enter the overbought region, indicating there’s scope for more gains in the near term. But the stochastics are already in overbought territory and the %K line is ready to cross below the %D line, signaling a possible downside correction, or at least, some easing in the upside momentum in the coming days.

AUD/USD beat resistance at 6933/38 December high for a medium-term buy signal targeting minor trend line resistance at 6970/73, 6995/99 & strong resistance at 7020/25 for profit-taking. The downside is expected to be limited despite overbought conditions. Good support at 6925/20 could hold the downside but try longs at 6910/00 if we fall further, with stops below 6880.

AUD/USD is trading at 0.6948; the instrument is moving above Ichimoku Cloud, thus indicating an ascending tendency. The markets could indicate that the price may test Tankan-Sen and Kijun-Sen at 0.6940 and then resume moving upwards to reach 0.7005. Another signal to confirm further ascending movement is the price’s rebounding from the rising channel’s downside border. However, the scenario that implies further growth may be canceled if the price breaks the cloud’s downside border and fixes below 0.6900. In this case, the pair may continue falling towards 0.6805.

AUD/USD Weekly Outlook

In favor of the fall of the pair on FOREX, a test of the downward trend line on the relative strength index
(RSI) will come out. The second signal will be a rebound from the upper boundary of the downward channel. Cancellation of the option to reduce AUD/USD in the current trading week December 30, 2019 — January 3, 2020 will be a strong growth and the breakdown level of 0.7135. This will indicate a breakdown of the upper boundary of the channel and continued growth of the Australian Dollar at FOREX. The development of the downward trend will be confirmed by the breakdown of the support area and closing below 0.6665. This will indicate an acceleration of the fall of the currency pair and the beginning of the development of the «Wedge» model.

AUD/USD Forecast December 30, 2019 — January 3, 2020, implies an attempt to test the level of 0.6995.
Further, the continuation of the fall below the level of 0.6355. In favor of reducing the pair, a test of the
downward trend line on the relative strength index (RSI) will come out. Cancellation of the fall option will
be a strong growth and a breakdown of the 0.7135 area. This will indicate a breakdown of the resistance
area and continued growth of the pair with a target above 0.7445.

2- Fundamental Overview-

  • AUD/USD looks to post gains for a fourth straight week.
  • AUD/USD moves 0.10% higher on Friday following today’s theme of USD weakness.
  • AUD/USD printing fresh five-month highs through the 200-DMA.
  • The phase-one trade deal in the making should underpin Aussie strength.
  • AUD/USD short-term bullish but capped by strong static resistance area around 0.6930.
  • The US will publish the Richmond Fed Manufacturing Index, seen at 9 in December.
  • AUD/USD fails to extend four-day-old recovery.

3- View & Additional key levels