Elliott Wave Forecast Team
ElliottWave-Forecast.com
Australian Dollar extended the decline to its lowest in a decade last week. The slump came after RBNZ (Reserve Bank of New Zealand) delivered a bigger than expected interest rate cut. RBNZ governor even went so far and promised to do whatever it takes, including more rate cut, negative rate, QE. This prompts the speculation that RBA (Reserve Bank of Australia) will follow the path. The currency dropped by 1.2% to 0.667 and broke below the January 2019 low of $0.674. This is the lowest level for the AUDUSD since March 2009 during the financial crisis.
Market look to be in a cycle of competitive rate cuts due to the escalating trade war between U.S. and China. After Trump’s threat of additional tariff, China has since let the Yuan slide in daily fixing to support the export. People’s Bank of China (PBOC) has allowed Yuan to weaken past the CNY 7.00 to $1 level for the first time since 2008. The move has dragged other worldwide currencies. South Korean Won, Australian Dollar, New Zealand Dollar all dropped following the Yuan’s move.
A weaker Chinese Yuan puts pressure on emerging market currencies. Back in 2015, a similar break in Yuan caused a sell-off in emerging market currencies, stoking fear of currency contagion. President Trump’s demand for more easing from the Fed to weaken the dollar and sharp depreciation in Chinese Yuan thus has indeed prompted a cycle of competitive rate cuts worldwide. Central Bank in India and Thailand have also announced larger than expected rate cuts last week.
EURAUD Weekly Elliott Wave Sequence
EURAUD shows an incomplete bullish sequence from July 2012. The structure of the rally from there is unfolding as a double zigzag Elliott Wave structure. The pair has a 100% target towards 1.857 – 1.975 area. A break above January 3, 2019 high (1.679) will be a sign that the next leg higher has started. It will also keep pressure in the Australian Dollar. We don’t like selling the pair and continue to favor the upside. However, we’d like to wait for a break above January 3, 2019 high first for confirmation.
EURAUD Daily Elliott Wave Chart
Above is one possible daily count for the pair. If pair can do 1 more leg higher to complete a 5 waves rally from April 17 low, then it will also break above Jan 3, 2019 high. This should confirm the bullish sequence like the previous weekly chart shows. Once pair breaks above 1.679, then subsequent pullback should be supported in the sequence of 3, 7, or 11 swing.
FURTHER DISCLOSURES AND DISCLAIMER CONCERNING RISK, RESPONSIBILITY AND LIABILITY Trading in the Foreign Exchange market is a challenging opportunity where above average returns are available for educated and experienced investors who are willing to take above average risk. However, before deciding to participate in Foreign Exchange (FX) trading, you should carefully consider your investment objectives, level of xperience and risk appetite. Do not invest or trade capital you cannot afford to lose. EME PROCESSING AND CONSULTING, LLC, THEIR REPRESENTATIVES, AND ANYONE WORKING FOR OR WITHIN WWW.ELLIOTTWAVE- FORECAST.COM is not responsible for any loss from any form of distributed advice, signal, analysis, or content. Again, we fully DISCLOSE to the Subscriber base that the Service as a whole, the individual Parties, Representatives, or owners shall not be liable to any and all Subscribers for any losses or damages as a result of any action taken by the Subscriber from any trade idea or signal posted on the website(s) distributed through any form of social-media, email, the website, and/or any other electronic, written, verbal, or future form of communication . All analysis, trading signals, trading recommendations, all charts, communicated interpretations of the wave counts, and all content from any media form produced by www.Elliottwave-forecast.com and/or the Representatives are solely the opinions and best efforts of the respective author(s). In general Forex instruments are highly leveraged, and traders can lose some or all of their initial margin funds. All content provided by www.Elliottwave-forecast.com is expressed in good faith and is intended to help Subscribers succeed in the marketplace, but it is never guaranteed. There is no “holy grail” to trading or forecasting the market and we are wrong sometimes like everyone else. Please understand and accept the risk involved when making any trading and/or investment decision. UNDERSTAND that all the content we provide is protected through copyright of EME PROCESSING AND CONSULTING, LLC. It is illegal to disseminate in any form of communication any part or all of our proprietary information without specific authorization. UNDERSTAND that you also agree to not allow persons that are not PAID SUBSCRIBERS to view any of the content not released publicly. IF YOU ARE FOUND TO BE IN VIOLATION OF THESE RESTRICTIONS you or your firm (as the Subscriber) will be charged fully with no discount for one year subscription to our Premium Plus Plan at $1,799.88 for EACH person or firm who received any of our content illegally through the respected intermediary’s (Subscriber in violation of terms) channel(s) of communication.
Recommended Content
Editors’ Picks
AUD/USD failed just ahead of the 200-day SMA
Finally, AUD/USD managed to break above the 0.6500 barrier on Wednesday, extending the weekly recovery, although its advance faltered just ahead of the 0.6530 region, where the key 200-day SMA sits.
EUR/USD met some decent resistance above 1.0700
EUR/USD remained unable to gather extra upside traction and surpass the 1.0700 hurdle in a convincing fashion on Wednesday, instead giving away part of the weekly gains against the backdrop of a decent bounce in the Dollar.
Gold stays firm amid higher US yields as traders await US GDP data
Gold recovers from recent losses, buoyed by market interest despite a stronger US Dollar and higher US Treasury yields. De-escalation of Middle East tensions contributed to increased market stability, denting the appetite for Gold buying.
Ethereum suffers slight pullback, Hong Kong spot ETH ETFs to begin trading on April 30
Ethereum suffered a brief decline on Wednesday afternoon despite increased accumulation from whales. This follows Ethereum restaking protocol Renzo restaked ETH crashing from its 1:1 peg with ETH and increased activities surrounding spot Ethereum ETFs.
Dow Jones Industrial Average hesitates on Wednesday as markets wait for key US data
The DJIA stumbled on Wednesday, falling from recent highs near 38,550.00 as investors ease off of Tuesday’s risk appetite. The index recovered as US data continues to vex financial markets that remain overwhelmingly focused on rate cuts from the US Fed.