Momentum Scorecard: Euro Surges versus Australian Dollar
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TREND IN FOCUS: EURAUD (D1)
- The EURAUD rebound off of the 8-SMA on June 17 coincided with the Slow Stochastics (5,3,3) issuing a new buy signal.
- The EURAUD hasn’t had two consecutive closes below the 8-SMA since late-April, and has remained above all three 8-/21-/55-SMAs since May 2.
- While an Inverted Hammer (reversal candle) is forming on the daily timeframe today, pullbacks into the 8-SMA are viewed as constructive as the trend score of +4.00 signals complete full timeframe continuity.
*Trend definitions: “uptrend” is defined as 8-MA>21-MA>55-MA; “downtrend” is defined as 8-MA<21-MA<55-MA; a “trendless” market occurs when continuity is absent.
*Scoring methodology: there are seven time frames, ascending from m15 (15-minutes) to W1 (one-week). In ascending order, each pair is assigned a value from -7 to +7 based on the trend apparent on the specified time frame (I.E. a m15 uptrend equals +1, whereas a H1 downtrend equals -3). If neither an uptrend nor downtrend is present, the trendless timeframe receives a score of 0. These points are totaled and the average is reported on the right. The strongest uptrend would achieve a score of +4.00, while the strongest downtrend would achieve a score of -4.00.
--- Written by Christopher Vecchio, Currency Analyst
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.