Since last week AUD/USD is up +1.88% against this year’s low which was at 0.68277.
The reason for this can be found in the recent Chinese economic data, which is stronger than expected.
The current price at 0.70333 is -3.69% compared to 2019 high at 0.7296.
This currency pair which has become a favoured vehicle of traders in recent years is strongly dependent on news from China, commodities, US and Australia’s financial prospects. Greenside of AUD/USD is the difference in interest rates in the currency pair. Thanks to this, traders can earn some extra cash for being long AUD/USD.
Is the right time to buy now?
The best time to buy something is when the price is low when you see a price on the bottom. As aforementioned, the lowest price this year was 0.68277, or 206 pips from current tare at 0.70333.
Due to volatility, AUD/USD can make up to 150 pips per day. Note that the highest volatility in this currency pair you can see at the start of US session, and on Tuesday and Friday.
Majority of traders who trade FX use technical analysis for their setups, so let us take a look at what we have now with AUD/USD.
On a daily time frame, we have RSI values oscillating from 44 to 61 level, and price going form 23.6 and 38.2 Fibonacci levels in small side trend since the beginning of June, while MA200 is showing long down trend from December 2018.
Notice the red arrows and Fibonacci 38.2 level. It looks like the same level is hard to break.
On H4 time frame side trend is more obvious.
The RSI is in the overbought area, and it can be that the price movement will form double top technical pattern formation. If this is the case, we can see a price reversal. Support area can be found near 0.6970.
The hourly time frame can give us guidance in future trade setup.
The price is in overbought territory, according to RSI. MA`s has formed Gold Cross, a buy signal, and the price is still above a small blue trend line, and the red line which after breaking point has led AUD/USD to its lowest level.
We will closely watch those levels to see whether the price will make another retreatment, or break Fibonacci 38.2 level. Limits are also one way to go.
If you want to benefit from rollover for being long AUD/USD, and you believe that AUD still has room to rise, then BUY is your call.