FxWirePro: Double Bottom And Double Top Patterns Signals Clarity For AUD/USD Minor And Major Trends – Trade One-Touch Call And Short Hedge

AUDUSD short term outlook: Double bottom with bottom 1 at 0.6864 and bottom 2 at 0.6831 levels signal strength in the minor uptrend, consequently, bulls managed to spike above 0.6940 levels (i.e. 21-DMAs) with bullish crossovers (refer daily chart).

For now, rallies most likely to extend further up to the stiff resistance of 0.7025 levels, while the momentum and trend oscillators indicate strength for further prevailing rallies.

Well, thereby, the pair is all set to spike above 2nd consecutive week highs amid consolidation range of 0.6831-0.70 areas, but it’s questionable how far it can run given trade tensions plus an RBA cut looming.

Hence, it is wise to snap any deceptive rallies at that juncture to build short hedges by shorting futures of mid-month tenors ahead of RBA monetary policy that is scheduled for the next week, as the AUD in the broader perspective still appears to be vulnerable.

Long-term outlook: Bearish engulfing patterns at 0.7760 and 0.7042 levels nudge prices way below EMAs, consequently, the major downtrend dragged further 4-months lows upon breach below the double top neckline at 0.7359 level (refer monthly plotting). 

RSI and stochastic curves indicate intensified selling momentum on this timeframe, while bearish EMA and MACD crossovers signal downtrend to prolong further.

On the flip side, as both the momentum and trend oscillators on daily term indicate strength for further rallies, intraday or short-term traders can participate in the prevailing rallies of this pair by buying one-touch calls using upper strikes at 0.7025 levels.

Currency Strength Index: FxWirePro's hourly AUD is flashing at 92 levels (highly bullish), while hourly USD spot index was at 32 (mildly bearish) while articulating (at 05:33 GMT). These indices are conducive for our intraday trades as shown above.

For more details on the index, please refer below weblink: http://www.fxwirepro.com/currencyindex