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
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Bullish
Gold
Bearish
GBP/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • 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/3FsnNdo7VK https://t.co/lC69rPbkcJ
  • $AUDUSD just weakened slightly following disappointing Chinese industrial production and retail sales data What is the Aussie facing over the next 24 hours and heading into next week? #AUD https://www.dailyfx.com/forex/market_alert/2020/08/14/Australian-Dollar-Outlook-Eyes-SP-500-Retail-Sales-After-Chinese-Data.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/b9pmxMkp8o
  • 🇨🇳 Unemployment Rate (JUL) Actual: 5.7% Previous: 5.7% https://www.dailyfx.com/economic-calendar#2020-08-14
  • 🇨🇳 Fixed Asset Investment (YTD) YoY (JUL) Actual: -1.6% Expected: -1.6% Previous: -3.1% https://www.dailyfx.com/economic-calendar#2020-08-14
  • 🇨🇳 Industrial Production YoY (JUL) Actual: 4.8% Expected: 5.1% Previous: 4.8% https://www.dailyfx.com/economic-calendar#2020-08-14
  • 🇨🇳 Retail Sales YoY (JUL) Actual: -1.1% Expected: 0.1% Previous: -1.8% https://www.dailyfx.com/economic-calendar#2020-08-14
  • Heads Up:🇨🇳 Unemployment Rate (JUL) due at 02:00 GMT (15min) Previous: 5.7% https://www.dailyfx.com/economic-calendar#2020-08-14
  • Heads Up:🇨🇳 Fixed Asset Investment (YTD) YoY (JUL) due at 02:00 GMT (15min) Expected: -1.6% Previous: -3.1% https://www.dailyfx.com/economic-calendar#2020-08-14
  • Heads Up:🇨🇳 Industrial Production YoY (JUL) due at 02:00 GMT (15min) Expected: 5.1% Previous: 4.8% https://www.dailyfx.com/economic-calendar#2020-08-14
  • Heads Up:🇨🇳 Retail Sales YoY (JUL) due at 02:00 GMT (15min) Expected: 0.1% Previous: -1.8% https://www.dailyfx.com/economic-calendar#2020-08-14
AUD/USD Short Term Levels Ahead of China's CPI Data

AUD/USD Short Term Levels Ahead of China's CPI Data

2016-08-08 10:22:00
Oded Shimoni, Junior Currency Analyst
Share:

Talking Points:

- AUD/USD still supported above 0.76 following Friday’s NFPs

- A quiet economic docket puts the spotlight on the China CPI data later for possible volatility

- GSI is a powerful big data indicator that can help you determine whether short-term trends will continue or reverse

The AUD/USD is still being supported above the 0.76 handle (at the time of writing) after the pair moved lower following Friday’s blockbuster NFP report.

A quiet economic calendar ahead shifts our focus to China's July CPI data for possible volatility for the pair given the trading relations between China and Australia.

Taking this into consideration, we look to find short term trading opportunities using the Grid Sight Index (GSI) indicator.

AUD/USD Short Term Levels Ahead of China's CPI Data

Click Here for the DailyFX Calendar

The AUD/USD surged higher last week after the RBA cut rates to 1.5%, as the market appeared to have interpreted the central bank’s statement as not indicative of further rate cuts at the moment. In this context, the Australian Dollar may still find support as a 1.5% rate is still attractive in the current record low yield environment.

In their policy statement, the RBA said that actions by Chinese policymakers are supporting the near-term growth outlook, but the underlying pace of China's growth appears to be moderating.

This puts the China Consumer Price Index (CPI) data in focus given the trading relations between the nations.

The headline year-on-year figure is expected to slow to 1.8% from the prior print of 1.9%, far from the PBOC’s target-level for CPI of 3.0%. A miss to expectations could increase the odds of the PBOC adopting a more dovish monetary policy, which could potentially hurt the Yuan and thus imports from Australia.

AUD/USD 3-Min GSI Chart: August 8, 2016

AUD/USD Short Term Levels Ahead of China's CPI Data

The AUD/USD is approaching a potential resistance area above 0.7637 (see chart below), with GSI calculating higher percentage of past movement to the downside in the short term. The GSI indicator above calculates the distribution of past event outcomes given certain momentum patterns, and can give you a look at the market in a way that's never been possible before, analyzing millions of historical prices in real time. By matching events in the past, GSI describes how often the price moved in a certain direction.

You can learn more about the GSI here.

AUD/USD Technical Levels:

AUD/USD Short Term Levels Ahead of China's CPI Data

Click here for the DailyFX Support & Resistance tool

We use volatility measures as a way to better fit our strategy to market conditions. The AUD/USD is seeing reduced levels of volatility (on 14-day ATR study). In turn, this could imply that range bound trading plays might be appropriate ahead.

AUD/USD 30-Min Chart: August 8, 2016

AUD/USD Short Term Levels Ahead of China's CPI Data

(Click to Enlarge)

The AUD/USD is trading below a potential resistance area above 0.7637. Further levels of interest on a move higher may be 0.7674, a zone above the 0.77 handle and 0.7750.

Levels of interest on a move lower could be the area above 0.76 followed by 0.7575, a zone below 0.7550 and the 0.75 handle.

When price reaches those levels, short term traders might use the GSI to view how prices reacted in the past given a certain momentum pattern, and see the distribution of historical outcomes in which the price reversed or continued in the same direction. We generally want to see GSI with the historical patterns significantly shifted in one direction, which could potentially be used with a pre-determined bias as well.

A common way to use GSI is to help you fade tops and bottoms, and trade breakouts. That’s why traders may want to use the GSI indicator when price reaches those specific pre-determined levels, and fit a strategy that can offer a proper way to define risk. We studied over 43 million real trades and found that traders who do that were three times more likely to turn a profit. Read more on the Traits of Successful Traders” research.

Meanwhile, the DailyFX Speculative Sentiment Index (SSI) is showing that about 40.0% of traders are long the AUD/USD at the time of writing. The SSI is mainly used as a contrarian indicator implying further strength ahead.

You can find more info about the DailyFX SSI indicator here

--- Written by Oded Shimoni, Junior Currency Analyst for DailyFX.com

To contact Oded Shimoni, e-mail oshimoni@dailyfx.com

Follow him on Twitter at @OdedShimoni

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

DISCLOSURES

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.