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. See our updated Privacy Policy here.

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
Subscribe
Please try again
EUR/USD
Mixed
Oil - US Crude
Bullish
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
Bearish
Gold
Mixed
GBP/USD
Bearish
USD/JPY
Bullish
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
  • The US 10Y beginning to retrace some of last week's rally, slowly crawling back towards 1.50% https://t.co/P2a5fHQUlq
  • Commodities Update: As of 18:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.03% Silver: -0.22% Gold: -0.70% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/XxGZAbPEdL
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Gold are long at 74.73%, while traders in France 40 are at opposite extremes with 78.49%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/7XIu5r1o2l
  • #Euro Forecast: $EURUSD Falters at Yearly Open Resistance- #FOMC Levels - https://t.co/uWukTncIRg https://t.co/dn84mhHxQx
  • The gold monthly opening-range is set just below confluence resistance – breakout to offer guidance. Get your $XAUUSD market update from @MBForex here:https://t.co/19rCMiLlxG https://t.co/uFGK8q14KG
  • WTI Crude Oil Breakout (Update) https://www.dailyfx.com/forex/analyst_picks/todays_picks/james_stanley/2021/06/14/wti-crude-oil-breakout-update.html $oil #oott https://t.co/UGOItnUhgd
  • Indices Update: As of 18:00, these are your best and worst performers based on the London trading schedule: Germany 30: -0.03% France 40: -0.10% US 500: -0.23% FTSE 100: -0.23% Wall Street: -0.71% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/th5Y4GcBcR
  • I don't think this has any easier a path to developing into momentum ahead of the Fed decision as bullish efforts elsewhere, but the $DJI Dow is tentatively breaking lower and the Nasdaq-to-Dow ratio usually showing spec reach is rising: https://t.co/eN8xb6JOhW
  • WTI crude oil has room to rally further. Around the 77 mark lies substantial long-term resistance. Get your market update from @PaulRobinsonFX here:https://t.co/J0qpmLG6wF https://t.co/M2sThc69rK
  • In May of last year, Paul Tudor Jones made a big statement in support of #BTC - was trading under 10k at the time. https://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/daily_fundamentals/2020/05/07/Bitcoin-Breakout-BTC-to-Fresh-Highs-JS-as-PTJ-Makes-Bull-Case-Bitcoin-to-USD.html 13 months later, he made some add'l remarks on #Bitcoin ahead of #FOMC - talked about it in this article https://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/daily_fundamentals/2021/06/14/has-bitcoin-btc-btcusd-bottomed-ptj-makes-bull-case.html
Weekly Australian Dollar Technical Forecast: Fresh Highs in Sight for AUD/JPY, AUD/USD

Weekly Australian Dollar Technical Forecast: Fresh Highs in Sight for AUD/JPY, AUD/USD

Christopher Vecchio, CFA, Senior Strategist
Weekly Australian Dollar Technical Forecast: Fresh Highs in Sight for AUD/JPY, AUD/USD

Technical Forecast for the Australian Dollar: Bullish

  • It may not be the most seasonally friendly time of year for the Australian Dollar, but a prevailing ‘risk-on’ mood in global financial markets is giving a bid to the commodity-linked currency.
  • Both AUD/JPY and AUD/USD rates are breaking higher out of recent consolidations, suggesting that near-term technical structure is bullish.
  • The IG Client Sentiment Index suggests that the AUD-crosses have different biases.

Australian Dollar Rates Week in Review

The first week of May proved a strong start for the trio of commodity currencies, which were the top three performers among the major currencies. Coming in first place, the Australian Dollar was able to post gains against all of its major counterparts, with pairs like AUD/JPY (+1%) and AUD/USD (+1.66%) posting the strongest gains. With the Reserve Bank of Australia now in the rearview mirror and a relatively benign economic calendar due in the days ahead, even though it may not be the most seasonally friendly time of year for the Aussie, a prevailing ‘risk-on’ mood in global financial markets is giving a bid to the commodity-linked currency.

AUD/USD RATE TECHNICAL ANALYSIS: DAILY CHART (March 2020 to May 2021) (CHART 1)

Weekly Australian Dollar Technical Forecast: Fresh Highs in Sight for AUD/JPY, AUD/USD

The last time we checked in on the AUD-crosses, it was noted that “AUD/USD’s uptrend from the March and November 2020 lows remains impaired, with the mid-March attempt higher failing to recapture the key trendline. But hope springs eternal: it may be the case that a bullish falling wedge is taking shape on the daily timeframe, with support drawn from the early-January high and early-March low, and resistance drawn from the late-February high and mid-March high.”

And while AUD/USD rates did indeed trade higher out of the bullish falling wedge, the month of April yielded little by way of advance or decline, setting up what may be interpreted as a bull flag. Accordingly, the breakout at the end of the week suggests that the period of consolidation has ended, and the prior interpretation of price action coalescing into a bull flag indeed correct. To this end, AUD/USD rates are still in the throes of the aforementioned bullish falling wedge, which eyes a return to the yearly high at 0.8007.

IG Client Sentiment Index: AUD/USD RATE Forecast (May 7, 2021) (Chart 2)

Weekly Australian Dollar Technical Forecast: Fresh Highs in Sight for AUD/JPY, AUD/USD

AUD/USD: Retail trader data shows 35.39% of traders are net-long with the ratio of traders short to long at 1.83 to 1. The number of traders net-long is 26.69% lower than yesterday and 27.00% lower from last week, while the number of traders net-short is 0.39% lower than yesterday and 14.74% higher from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests AUD/USD prices may continue to rise.

Traders are further net-short than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger AUD/USD-bullish contrarian trading bias.

AUD/JPY RATE TECHNICAL ANALYSIS: DAILY CHART (MARCH 2020 to May 2021) (CHART 3)

Weekly Australian Dollar Technical Forecast: Fresh Highs in Sight for AUD/JPY, AUD/USD

AUD/JPY rates have maintained their uptrend from the March and November 2020 lows unlike its AUD/USD brethren, but like its counterpart, a bullish falling wedge appears to be the predominant short-term pattern that’s guiding price action. With AUD/JPY rates above their daily EMA envelope, which is in bullish sequential order, daily MACD rising while above its signal line, and daily Slow Stochastics achieving overbought territory, bullish momentum is firming. A push to the yearly high at 85.45 (and beyond) is squarely in focus over the coming days.

IG Client Sentiment Index: AUD/JPY Rate Forecast (May 7, 2021) (Chart 4)

Weekly Australian Dollar Technical Forecast: Fresh Highs in Sight for AUD/JPY, AUD/USD

AUD/JPY: Retail trader data shows 33.56% of traders are net-long with the ratio of traders short to long at 1.98 to 1. The number of traders net-long is 5.06% lower than yesterday and 8.70% higher from last week, while the number of traders net-short is 5.71% lower than yesterday and 6.60% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests AUD/JPY prices may continue to rise.

Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current AUD/JPY price trend may soon reverse lower despite the fact traders remain net-short.

CFTC COT Australian Dollar Futures Positioning (May 7, 2020 to May 7, 2021) (Chart 5)

Weekly Australian Dollar Technical Forecast: Fresh Highs in Sight for AUD/JPY, AUD/USD

Finally, a consideration of positioning in the futures market. According to the CFTC’s COT for the week ended May 4, speculators flipped their Australian Dollar positioning to net-long with 1,476 contracts, a shift from the 1,410 net-short contracts held in the week prior. Considering how benign positioning is in the future market, there is ample room for the Australian Dollar to embark on a trend without risk of ‘overcrowding’ in the short-term.

--- Written by Christopher Vecchio, CFA, Senior Currency Strategist

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

DISCLOSURES