Analytical Review of the Currency Pair AUD/USD

Analytical Review of the Currency Pair AUD/USD

12 April 2016, 14:19
Roberto Jacobs
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Analytical Review of the Currency Pair AUD/USD

Technical data of the currency pair:

Previous closing: 0.7595; Daily range: 0.7583-0.7652;
Opening: 0.7595; 52- week range: 0.6824-0.8168;
Annual revenue: -1.18%; Change in % for the previous day: +0.38;

Analytical review:

  • Over the last two trading sessions the AUD has strengthened against the USD (over 100 points). During yesterday’s session the price of the currency increased by 0.38%;
  • China is important strategic partner of Australia. According to the Chinese National Bureau of Statistics, consumer price index in March was at the previous level of 2.3% against the forecast of 2.5%;
  • The AUD is a commodity currency. Further rise in the AUD depends on the rise in oil prices. Over the last two trading sessions the price of crude oil WTI rose by 9%;
  • “Commitments of Traders” shows the increase the number of short positions by 2555 contracts up to 52002. 21220 contracts have been made for long positions;
  • The data of this week will include US oil inventories on Wednesday. US Producer price index (PPI) on Wednesday and Australian employment rate (Thursday). This data may affect market volatility and movement dynamics in the pair.

Summary:

  • Mixed Chinese statistics and high volatility in the financial markets put significant pressure on the currency pair. Demand for the AUD is supported by the rise in prices of oil. According to “COT,” large investors have increased the number of short positions.
  • Movement is mixed in the market. We recommend to enter the market from the key support and resistance levels


Trading tips for the currency pair AUD/USD

Medium-term trading: At the moment the currency has broken down the local resistance level of 0.7615. If the price maintains mirrored support level of 0.7615 and in case of the respective confirmation (such as Price Action pattern), we recommend to open long positions. Risk per trade is not more than 2% of the capital. Stop order can be placed slightly below the signal line. Take profit can be placed in parts at the levels of 0.7670, 0.7710 and 0.7750 with the use of trailing stops.


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Short-term trading: on the chart with the timeframe 15M the currency is traded in the range of 0.7610-0.7625. If the price maintains these levels we recommend to open long positions. Risk per trade is not more than 3% of capital. Stop order can be placed at the level of 0.7605. Take profit can be placed in parts at the levels of 0.7640, 0.7665 and 0.7690 with the use of trailing stop.


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The material has been provided by LiteForex - Finance Services Company - www.liteforex.com


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