FxWirePro: “Shooting stars” on Antipodean currency signal more slumps betting on RBA rate cuts

Although Aussie dollar shows strength against Kiwi dollar today it has rejected at resistance levels of 1.0750. Shooting star pattern has occurred at 1.0646 levels on the weekly graph which is bearish in nature.

Back-to-back “Shooting Star” patterns occurred even on daily graphs at 1.0621 and 1.0637 levels too signify the weakness in this pair as traders and investors expect a rate cut of 25 bps in tomorrow’s RBA monetary policy.

These candle patterns are highly bearish in nature that has occurred at resistance levels of 1.0750 levels to evidence the downswings below DMA and EMA curves.

We could see current prices are struggling to hang around 21DMA  and it is on the verge of 7DMA crossing below 21DMA.

At this juncture, one can observe the leading oscillators bearish convergence to these declining rallies.

RSI right from overbought trajectory has been converging downwards to these bearish effects that signal the strength in these selling sentiments in the spot.

While, on daily charts the stochastic has been evidencing the %D crossover above 80 levels which is again an overbought territory that indicates the selling momentum can still be seen.

Hence, at spot ref: 1.0534 levels one can go short in near month futures for targets of 60-80 pips southwards with a strict stop loss at 1.0568 levels.