News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Bearish
Oil - US Crude
Mixed
Wall Street
Mixed
Gold
Bearish
GBP/USD
Bearish
USD/JPY
Bullish
More View more
Real Time News
  • There is a great debate about which type of analysis is better for a trader. Is it better to be a fundamental trader or a technical trader? Find out here: https://t.co/aVAzFypAg1 https://t.co/7mc19Gxrvm
  • #Gold prices succumbed to selling pressure as the US Dollar soared this past week What is #XAUUSD facing these next few days and can these fundamental forces extend its selloff? Check out my outlook here - https://www.dailyfx.com/forex/fundamental/forecast/weekly/chf/2020/09/26/Gold-Price-Outlook-Rising-US-Dollar-Sinks-XAUUSD-Will-Losses-Extend.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/gPhy0KoW3W
  • GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall health and potential growth of a country. Learn use GDP data to your advantage here: https://t.co/38gTDnpPbn https://t.co/Xtk5g4JQEB
  • Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Learn about FX leverage here: https://t.co/3Wked6GBOp https://t.co/SsUguHB39W
  • Key levels in forex tend to draw attention to traders in the market. These are psychological prices which tie into the human psyche and way of thinking. Learn about psychological levels here:https://t.co/1oygcFMFNs https://t.co/aD1ZWhTWZp
  • The price of #oil may continue to trade in a narrow range as the rebound from the September low ($36.13) appears to have stalled ahead of the month high ($43.43). Get your #commodities update from @DavidJSong here: https://t.co/719LgjFmYG https://t.co/SSoqjONUzA
  • The Australian Dollar may extend its slide lower despite the planned easing of Covid-19 restrictions, as the market continues to price in an RBA rate cut on October 6. Get your #currencies update from @DanielGMoss here: https://t.co/HJpngnerzY https://t.co/g6X8ABQDwY
  • The Indian Rupee may be at risk to the US Dollar as USD/INR attempts to refocus to the upside. This is as the Nifty 50, India’s benchmark stock index, could fall further. Get your USD/INR market update here:https://t.co/ed4QR7QQOn https://t.co/gDWYNtm2UY
  • Technical indicators are chart analysis tools that can help traders better understand and act on price movement. Learn more about the importance of technical analysis here: https://t.co/NpC1D8y4Aa https://t.co/Q7TcbrYXjl
  • #Gold prices have plunged nearly 11% off the record highs with a breakout risking further losses. Here are technical trade levels that matter on the XAU/USD weekly chart. Get your #metals update from @MBForex here: https://t.co/7p3jPx6nQd https://t.co/yxymjCHti6
AUD/USD RSI Sits in Overbought Territory for First Time Since 2014

AUD/USD RSI Sits in Overbought Territory for First Time Since 2014

2017-07-18 15:24:00
David Song, Strategist
Share:

Talking Points:

- AUD/USD Rallies to Fresh 2017-High as RBA Removes Easing Bias.

- GBP/USD June Rebound Unravels as U.K. CPI Disappoints.

-DailyFX 3Q Forecasts Are Now Available.

DailyFX Table

Ticker

Last

High

Low

Daily Change (pip)

Daily Range (pip)

AUD/USD

0.7923

0.7943

0.7786

122

157

AUD/USD breaks the 2016 range, with the pair at risk for a further advance as the Reserve Bank of Australia (RBA) start to discuss future changes to the official cash rate.

The RBA Minutes suggest Governor Philip Lowe and Co. are now on course to remove the record-low interest rate as officials forecast ‘a neutral nominal cash rate of around 3½ per cent.’ Even though ‘developments in the labour and housing markets continued to warrant careful monitoring,’ the RBA may continue to change its tune over the coming months as ‘the data available for the June quarter had generally been positive, following the slower growth recorded for the March quarter.’

As a result, the employment report due out later this week may fuel the near-term resilience in the Australian dollar as the economy is anticipated to add another 15.0K jobs in June.

AUD/USD Daily

AUD/USD Daily Chart

Chart - Created Using Trading View

  • The Fibonacci overlap around 0.7930 (50% retracement) to 0.7940 (61.8% retracement) appears to be capping the AUD/USD rally, but the near-term outlook remains constructive as price and the Relative Strength Index (RSI) preserve the bullish formations carried over from May.
  • Keep in mind the RSI is trading above 70 for the first time since 2014, with the aussie-dollar exchange rate at risk for a further advance as the momentum indicator pushes deeper into overbought territory.
  • May see the former resistance-zone around 0.7740 (78.6% expansion) to 0.7770 (61.8% expansion) now act as support, with the next topside hurdle coming in around 0.8020 (38.2% expansion) followed by the 0.8150 (100% expansion) region.

Ticker

Last

High

Low

Daily Change (pip)

Daily Range (pip)

GBP/USD

1.3027

1.3126

1.3005

28

121

The British Pound lags behind its major counterparts as the U.K. Consumer Price Index (CPI) unexpectedly slowed in June, and GBP/USD may continue to give back the advance from the June-low (1.2589) as the narrowing threat for above-target inflation drags on interest-rate expectations.

Even though the Retail Sales report is expected to show a rebound in household spending, easing price pressures may keep the Bank of England (BoE) on the sidelines as officials note ‘pay growth has moderated further from already subdued rates, even as the unemployment rate has fallen to 4.6%, its lowest in over 40 years.’ As a result, the majority of BoE officials may merely look to buy more time at the next meeting on August 3 amid the mixed data prints coming out of the U.K. economy.

GBP/USD Daily

GBP/USD Daily Chart

Chart - Created Using Trading View

  • GBP/USD stands at risk for further losses following the string of failed attempts to close above the Fibonacci overlap around 1.3090 (38.2% retracement) to 1.3120 (78.6% retracement), while the Relative Strength Index (RSI) continues to come off of trendline resistance.
  • A break below 1.2950 (23.6% retracement) may spur a move back towards 1.2860 (61.8% retracement), with the next downside hurdle coming in around 1.2630 (38.2% expansion) to 1.2680 (50% retracement), which sits just below the 100-Day SMA (1.2712).
IG Sentiment

Track Retail Sentiment with the New Gauge Developed by DailyFX Based on Trader Positioning

  • Retail trader data shows 24.6% of traders are net-long AUD/USD with the ratio of traders short to long at 3.06 to 1. In fact, traders have remained net-short since June 4 when AUD/USD traded near 0.74595; price has moved 6.3% higher since then. The number of traders net-long is 0.8% higher than yesterday and 26.2% lower from last week, while the number of traders net-short is 2.2% higher than yesterday and 42.2% higher from last week.
  • Retail trader data shows 37.3% of traders are net-long GBP/USD with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since June 23 when GBP/USD traded near 1.26263; price has moved 3.2% higher since then. The number of traders net-long is 3.0% higher than yesterday and 9.2% lower from last week, while the number of traders net-short is 1.3% lower than yesterday and 18.0% higher from last week.
AUD/USD RSI Sits in Overbought Territory for First Time Since 2014

Click Here for the DailyFX Calendar

--- Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

To be added to David's e-mail distribution list, please follow this link.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES