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4 Aug 2014
AUD/USD: Look to sell rallies - TDS
FXStreet (Bali) - The Toronto FX Research Team at TD Securities recommends to sell rallies on AUD/USD.
Key Quotes
"AUDUSD slipped below support at 0.9330 this week. While the spot market bounced modestly Friday from minor pullback support at 0.9288, the rebound was capped in the low 0.93 area (the 0.9330 support point now becomes resistance), technical progress downside should continue towards the next support zone around 0.92 (Q2 lows at 0.9205 and 38.2% Fibonacci retracement derived from the 0.8660/0.95 rally at 0.9182) in the week ahead.
"A close-up look at the weekly candle patterns reveals a couple of interesting things from a technical perspective. Firstly, the big weekly key reversal signal from late June —the basic reason for our negative view of the AUD’s technical prognosis—remains intact."
"In broad terms, we have to expect a sizeable correction (at least) of this year’s AUD rally from the upper 0.86 area as a result. Secondly, despite the late week rebound in spot, the AUD is still heading for its lowest weekly close since late May."
"This should shift trend followers a little more materially towards a bearish view of the AUD’s technical outlook and drive up selling interest on rallies."
"A final factor not related to the charts specifically is the fact that the AUD typically fares quite poorly in August from a seasonal perspective. Everything we see at the moment points to a repeat this year."
Key Quotes
"AUDUSD slipped below support at 0.9330 this week. While the spot market bounced modestly Friday from minor pullback support at 0.9288, the rebound was capped in the low 0.93 area (the 0.9330 support point now becomes resistance), technical progress downside should continue towards the next support zone around 0.92 (Q2 lows at 0.9205 and 38.2% Fibonacci retracement derived from the 0.8660/0.95 rally at 0.9182) in the week ahead.
"A close-up look at the weekly candle patterns reveals a couple of interesting things from a technical perspective. Firstly, the big weekly key reversal signal from late June —the basic reason for our negative view of the AUD’s technical prognosis—remains intact."
"In broad terms, we have to expect a sizeable correction (at least) of this year’s AUD rally from the upper 0.86 area as a result. Secondly, despite the late week rebound in spot, the AUD is still heading for its lowest weekly close since late May."
"This should shift trend followers a little more materially towards a bearish view of the AUD’s technical outlook and drive up selling interest on rallies."
"A final factor not related to the charts specifically is the fact that the AUD typically fares quite poorly in August from a seasonal perspective. Everything we see at the moment points to a repeat this year."