Trade of the Day
BUY AUDUSD 0.6811 STOP 0.6741 TARGET 0.6973 (RISK 0.50%)
AUD: Speaking in the NSW Northern Tablelands town of Armidale on Tuesday night, Reserve Bank of Australia (RBA) Governor Phillip Lowe said even though the national economy was now at a "gentle turning point", there were still local and international risks and too many Australians were without a job or wanted more working hours. The AUD caught a bid in response, with rate cut expectations pared slightly. Market participants remain cautious especially if Sino-US hopes fade ahead of the October RBA scheduled interest rate meeting.
USD: US stocks and treasuries yields fell overnight as risk-off mode plagued markets following US House Speaker Nancy Pelosi’s announcement of an inquiry to impeach President Donald Trump. Trump lambasted China at the UN General Assembly, and investors were concerned that this could derail current US-China trade talks. Adding to the worry was the poor reading of September US consumer confidence, reflecting Americans’ rising concerns over slower growth outlook. It’s not just the impeachment static. In the near term, the USD may remain susceptible to impeachment concerns but broader risk aversion may well continue to muddy the dollar’s broader directionality. Apart from global macro negativity, note that broader Sino-US trade tensions remain near the surface with Trump’s isolationist address and diatribe against China at the UN.
From a technical and trading perspective the AUDUSD continues to find bids at the support cluster around the 61.8% retracement and monthly pivot. Yesterday's price action and reversal was sufficient to turn the near term VWAP bullish, as such I will venture long through yesterday's highs with a stop below the current swing lows targeting an equality objective at .6973 as highlighted in the chart.
Please note that this material is provided for informational purposes only and should not be considered as investment advice. The views discussed in the above article are those of our analysts and are not shared by Tickmill. Trading in the financial markets is very risky.
Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.
Past performance is not indicative of future results.
High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 75% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Futures and Options: Trading futures and options on margin carries a high degree of risk and may result in losses exceeding your initial investment. These products are not suitable for all investors. Ensure you fully understand the risks and take appropriate care to manage your risk.
Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!