The statements by the President of the Australian central bank (RBA) have turned on the debate especially on AUDUSD that dropped over 150 pips in the last two trading days.
The overvalued exchange is evidently starting to be a problem for Australians who also suffer from the falling of prices of many raw materials and a slowdown in China. For what concerns AUDUSD, the line not to be exceeded is 0.92 (200-day moving average which on several occasions has supported the change in 2014), but then there is the risk of a stronger weakness of AUD in the coming weeks as we can see from the cross analysis combined with that of the 8-week Roc. Since the bull market of EURAUD started, every time in two months that the cross has lost about 5% (vertical bars), the exchange rate has recorded a primary bottom that indicated its new rise. This event in May did not trigger the rise of EURAUD, but now there is a stark difference which should make the change come back to higher levels.
The overvalued exchange is evidently starting to be a problem for Australians who also suffer from the falling of prices of many raw materials and a slowdown in China. For what concerns AUDUSD, the line not to be exceeded is 0.92 (200-day moving average which on several occasions has supported the change in 2014), but then there is the risk of a stronger weakness of AUD in the coming weeks as we can see from the cross analysis combined with that of the 8-week Roc. Since the bull market of EURAUD started, every time in two months that the cross has lost about 5% (vertical bars), the exchange rate has recorded a primary bottom that indicated its new rise. This event in May did not trigger the rise of EURAUD, but now there is a stark difference which should make the change come back to higher levels.
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