AUDUSD – Daily Chart
As suggested in our last inter-day chart analysis, price has been finding support around the horizontal support at 0.7340. The AUDUSD continues to move within a bearish channel but is also looking indecisive. Price is ranging between the horizontal support at 0.7335 and the horizontal resistance at 0.7470. Trading opportunities could exist around the support and resistance areas of the range and if the AUDUSD closes out of the range (break-out trade). The moving averages are bearish and widening, signalling that price may continue the downtrend. Selling opportunities could exist around the channel resistance area and around the dynamic resistance of the moving averages.
The Reserve Bank of Australia (RBA) have held the official interest rate at 1.5% for over 18 months. The Australian economy continues to grow at a steady pace and produce positive economic indicators under the low interest rate – giving incentive to keep the rate as it is. The US Federal Open Market Committee (FOMC) recently raised rates to 2.00%. Recent employment and other economic data for the US has been very positive. This suggests that there could be further rate hikes in the near future. This has given strength to the US Dollar.
EURGBP – Daily Chart
Price has bounced off the horizontal resistance at 0.8960 (as suggested in our last inter-day chart analysis). The EURGBP continues to be choppy and indecisive. The moving averages confirm the current indecision – they are tight and are moving sideways. Trading opportunities may exist around the identified horizontal levels at 0.8635, 0.8695, 0.8960, 0.9010 and 0.9260.
Recent economic indicators for the UK have been positive – giving strength to the GBP. The Bank of England (BOE) recently increased the base interest rate by 0.25% and plan to increase rates again in the very near future. Political indecision over the Brexit plan and uncertainty over the future of the UK’s trade deals is weakening the GBP. The ECB have announced that the economic future of the Euro-zone is looking more stable and that deflation and economic slow-down is low-risk – the euro-zone economy is performing well. Recent comments by the ECB have been fairly dovish though. Most economists believe that the current economic boom will slow-down and that an interest rate hike is not in the near future.
USDCHF – Daily Chart
The USDCHF has been rejected around the horizontal resistance at 1.0055 and has since become indecisive. Price is ranging between the recent swing low at 0.9800 and the horizontal resistance at 1.0055. Trading opportunities could exist around the support and resistance areas of the range and if the USDCHF closes out of the range (break-out trade). The moving averages are bullish and widening, suggesting that price may break to the upside.
The US Federal Open Market Committee (FOMC) recently raised rates to 2.00%. Recent employment and other economic data for the US has been very positive. This suggests that there could be further rate hikes in the near future. This has given strength to the US Dollar. The bearish stock markets may give strength to the Swiss Franc as the CHF is a safe-haven currency. The concern of a potential tariff war between the US and China may also give strength to the CHF.