5 Aug 2015
AUD/USD rallied on Stevens, downside limited - FXStreet
FXStreet (Guatemala) - Valeria Bednarik, chief analyst at FXStreet, explained that the Australian dollar soared yesterday as the RBA kept rates on hold, but particularly because Governor Glenn Stevens signalled that the latest plunge in the Aussie has done enough to boost the economy.
Key Quotes:
"Stevens dumped his demand for a lower AUD for the first time this year, sending the AUD/USD up initially over 100 pips, and with the pair extending up to 0.7428 in the American afternoon. Lockhart put a halt in the rally, with the pair now retreating from its highs, but well into the green daily basis. Technically the 1 hour chart shows that the 20 SMA heads sharply higher below the current price, offering an immediate support around 0.7260, whilst the technical indicators are retreating from extreme overbought territory.
In the 4 hours chart, the Momentum indicator turned higher above the 100 level after correcting overbought readings, whilst the RSI indicator hovers around 61 and the 20 SMA heads higher below the current level, all of which should keep the downside limited in the short term."
Key Quotes:
"Stevens dumped his demand for a lower AUD for the first time this year, sending the AUD/USD up initially over 100 pips, and with the pair extending up to 0.7428 in the American afternoon. Lockhart put a halt in the rally, with the pair now retreating from its highs, but well into the green daily basis. Technically the 1 hour chart shows that the 20 SMA heads sharply higher below the current price, offering an immediate support around 0.7260, whilst the technical indicators are retreating from extreme overbought territory.
In the 4 hours chart, the Momentum indicator turned higher above the 100 level after correcting overbought readings, whilst the RSI indicator hovers around 61 and the 20 SMA heads higher below the current level, all of which should keep the downside limited in the short term."