AUDUSD Analysis | Waiting for bearish signal?
Updated
Hi Traders!
The Australia dollar held its recent decline to around $0.676 as the greenback strengthened on the latest US inflation reading which prompted traders to pare bets on an aggressive Federal Reserve rate cut.
Markets now await a crucial US monthly jobs report this week as the Fed's attention moves from inflation to the labor market. Domestically, investors digested data showing Australia’s manufacturing sector extended its slump in August as high borrowing costs and subdued demand weighed on new orders.
On the monetary policy front, markets look forward to the latest remarks from Reserve Bank of Australia Governor Michelle Bullock this week. She said recently that despite signs of easing inflation, it was still “premature” to consider cutting rates. Minutes of the RBA’s last meeting also revealed that policy could stay restrictive for an extended period.
TECHNICAL ANALYSIS
From a technical point of view, in the short term the pair could be interesting on the bearish side, if we look at the daily chart, we need to see a new low to confirm some selling opportunities. With this in mind, if during today's session but not beyond tomorrow's candle, the pair will trigger another bearish leg, it could be interesting to try to take a short position on a technical rebound, reducing the potential stop loss as much as possible. Let's see what will happen during today's session...
Thanks for watching!
The Australia dollar held its recent decline to around $0.676 as the greenback strengthened on the latest US inflation reading which prompted traders to pare bets on an aggressive Federal Reserve rate cut.
Markets now await a crucial US monthly jobs report this week as the Fed's attention moves from inflation to the labor market. Domestically, investors digested data showing Australia’s manufacturing sector extended its slump in August as high borrowing costs and subdued demand weighed on new orders.
On the monetary policy front, markets look forward to the latest remarks from Reserve Bank of Australia Governor Michelle Bullock this week. She said recently that despite signs of easing inflation, it was still “premature” to consider cutting rates. Minutes of the RBA’s last meeting also revealed that policy could stay restrictive for an extended period.
TECHNICAL ANALYSIS
From a technical point of view, in the short term the pair could be interesting on the bearish side, if we look at the daily chart, we need to see a new low to confirm some selling opportunities. With this in mind, if during today's session but not beyond tomorrow's candle, the pair will trigger another bearish leg, it could be interesting to try to take a short position on a technical rebound, reducing the potential stop loss as much as possible. Let's see what will happen during today's session...
Thanks for watching!
Note
At the moment the pair has not triggered a bearish signal yet, so we remain flat and see what happens in the next few hours.Note
The Australian dollar depreciated past $0.675, hitting an over one-week low as softer iron ore and other commodity prices weighed on the currency, as the country’s economy relies heavily on its commodity exports. Investors also digested data showing government spending was the main driver of economic growth last quarter, indicating potential weakness in the economy.
Moreover, Australia’s manufacturing sector extended its slump in August as high borrowing costs and subdued demand weighed on new orders. Traders now await Australia’s second quarter GDP numbers on Wednesday and Reserve Bank of Australia Governor Michele Bullock’s latest comments on Thursday for fresh insights on the monetary policy path. Externally, the aussie was facing renewed pressure from a stronger greenback as the latest US inflation reading prompted traders to pare bets on an aggressive Federal Reserve rate cut.
Trade closed: target reached
My idea was a potential 5-3-5 or 5-3-3 Pattern, but Monday's candle was very broad, giving rise to a simple 3 wave Pattern:
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