Good day forex traders.
Having a nice warm weather over here for me. Not exactly the same for the foreign exchange markets i guess. Many readers told me they were trying to go long on the AUD/USD and .. well you guessed it right.
In the previous AUD/USD weekly review we noted that the chart action was bearish. Fundamentally, with an interest rate cut by the Reserve Bank of Australia and the risk aversion sentiments, high yielding assets including the Australian dollar were getting sold.
As mentioned last week, the currency pair was bearish and the AUD/USD did indeed dropped.
SMA 20 = Bearish
SMA 50 = Bearish
With the SMA 20 below and SMA 50 almost below the SMA 200 ( An indicator of possible long trends ), the technical situation is getting more bearish. Up ahead will be the strong support and resistance region of 1.000 . Parity point. Should this line fails, a new dimension of sub 1 values will be opened up.
Risk aversion is basically plaguing the global markets as various financial flash points are under fire. The Greek and French polls were interpreted as an U turn on economic growth. The question of Greece membership in the Euro Zone further exacerbates the situation as investors do not like political fall outs.
China is also seen as further slowing down. It’s status as an important trading partner for Australia makes this a critical issue.
The S&P/ASX 200 has fallen below 4300, indicating the devaluation of Australian equities.
The Australian economy and currency is very much affected by the global financial pulse. Monitor it closely.
Related Forex Articles from the Koala Forex Training College.