AUD/USD Signal Today - 24/07: Oversold As Crash Continues
Date
7/24/2024 4:53:34 AM
(MENAFN- Daily Forex) Bullish view
Buy the AUD/USD pair and set a take-profit at 0.6665. Add a stop-loss at 0.6575. Timeline: 1-2 days.
Bearish view
Sell the AUD/USD pair and set a take-profit at 0.6550. Add a stop-loss at 0.6665.
The AUD/USD pair continued its strong downtrend this week as concerns about the Chinese
Economy accelerated. The pair dropped for seven consecutive days, its longest losing streak this year. It has retreated by 2.70% from its highest level this year, moving to its lowest point since June 18th.
The AUD/USD crashed as concerns about the Chinese economy continued. Recent data showed that the economic growth was not growing as fast as expected. And the recent Third Plenum left most investors disappointed as it did not provide more strategies to boost growth.
These events have led to a sharp decline in top commodity prices. Copper has dropped by 6% in the past 30 days while iron ore has slumped to $108. Other commodity prices like natural gas and wheat have dropped.
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The AUD/USD pair will next react to the upcoming US manufacturing and services PMI numbers. Economists expect the numbers to show that activity remained steady in July.
The other data to watch this week will be the upcoming US GDP and durable goods orders numbers. Economists expect the number to show that the GDP expanded by 1.8% in the second quarter after growing by 1.4% in Q1.
The most important number will be the US personal consumption expenditure (PCE) report on Friday. These are key numbers because they are the Federal Reserve's favorite inflation data since they include rural and urban prices/USD technical analysis
The AUD/USD exchange rate has continued its strong downward trend this week. It has had its longest downward trend this year. The pair has moved below the 25-day moving average and found a strong support at the 200-day MA.
It has also entered the Ichimoku cloud indicator while the Relative Strength Index (RSI) has moved below the neutral point at 50. The pair moved below the key support level at 0.666, its highest swing on March 8th.
The stochastic oscillator has also moved below the oversold level of 25. Therefore, the pair will likely bounce back as investors buy the dip. If this happens, the next point to watch will be at 0.666. The stop-loss of this trade will be at 0.6450.
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