AUD/USD Teknik Analiz - AUD/USD Ticaret: 2015-08-30

Australia: the key rate and the gold influence

Australia is known to be the forth market by the volume of gold supply in the world so no wonder the Australian Dollar has shown the bearish trend following the 3% slump of the XAU. At the same day, the volume of futures trade has grown by 60% which proves the commitment of the market participants. Shall we expect the trend to continue given the high uncertainty coming from China?

The answer to this question largely depends on the fundamental state of the economy which the Bank of Australia is to set on Tuesday morning. It will not only release the new key rate but specify as well the economic growth prospects and inflation. This means unveiling the future monetary policy. The expectations remain negative in general as the GDP has not yet reached the pre-crisis level. Does this influence the currency movements? The daily chart shows the price has left the consolidation zone where it had been for two weeks in a row. In the meantime, the trade volumes have shot up which means the market was subject to fundamental changes.

Leaving the range is fully confirmed by the signal of RSI-Bars oscillator, which has broken through the triple bottom on that very day when the gold price plunged (the break-through is circled on the chart). The trend indicator Donchian channel supports the decline. This means we can focus on the important weekly support level of 0.70401. We shall expect the continued bearish trend in case the support is broken through on Tuesday morning. The risk-averse investors are recommended to wait until the trade volume of AUD increases on the CME to at least 100,000 orders a day. More aggressive traders can open the short position below the 0.70401 with the stop loss above 0.74461. We recommend to move the stop every day towards the breakeven point (the strategy of following the trend), placing it above the previous high. By doing this we change the probable profit/loss ratio in our favour.