Markets are Irrational
- #101,845
- Jul 16, 2017 7:10am Jul 16, 2017 7:10am
Price always retraces a little bit, but if anyone is expecting major retracements next week, I am not sure if they will get to see that. There are no indications at least in the charts, unless USD gains strength or Aussie falls on commodity prices. But at the same time it also may not go up. We may see a lot of consolidation (hence ranging), of traders taking profits or short covering.
On Tuesday, RBA is releasing its policy minutes and this may cause a retracement (read may and not will). Even though, no one is expecting the US to hike their rates until Dec this year, any change in US economic releases might push this to happen earlier.
And remember, once the US hike's the rates (currently it is 1.25%) then it will match Australian rates (which is currently at 1.5%). RBA may not be able to increase rates without creating more risks in the economy, as it will put more pressure on real estate mortgages so less likely for that to happen. It will actually be under pressure to cut rates, which again it is not that inclined to do, as it makes the housing crisis here worse.
So I feel RBA may try to be neutral until the US increases its rates to 1.5%. Once that happens, there will be no interest rate differentials and obviously US dollar is the preferred choice. Hence Aussie will keep falling after that to as low as 0.50 (of course over a year or 2). But RBA may play out negative sentiment on the Aussie, so that it falls a bit or retraces.
And I am also tracking the abolition of the Dodd-Franks Act in the US and changes to tax laws allowing US companies to bring in cash from overseas at reduced taxes. If this happens, the demand for USD will spike as billions are expected to come in to the US if this change is made. As foreign companies will be buying the USD to bring the cash in. So expect the USD to rise significantly around this news event, and more later if the laws are passed. And this event is expected to happen this year. So fall in the Aussie could be just around the corner, and we may not even have to wait for the US rate hike.
So 2017 will be very interesting for the Australian dollar with plenty of trading opportunities and a lot of volatility
On Tuesday, RBA is releasing its policy minutes and this may cause a retracement (read may and not will). Even though, no one is expecting the US to hike their rates until Dec this year, any change in US economic releases might push this to happen earlier.
And remember, once the US hike's the rates (currently it is 1.25%) then it will match Australian rates (which is currently at 1.5%). RBA may not be able to increase rates without creating more risks in the economy, as it will put more pressure on real estate mortgages so less likely for that to happen. It will actually be under pressure to cut rates, which again it is not that inclined to do, as it makes the housing crisis here worse.
So I feel RBA may try to be neutral until the US increases its rates to 1.5%. Once that happens, there will be no interest rate differentials and obviously US dollar is the preferred choice. Hence Aussie will keep falling after that to as low as 0.50 (of course over a year or 2). But RBA may play out negative sentiment on the Aussie, so that it falls a bit or retraces.
And I am also tracking the abolition of the Dodd-Franks Act in the US and changes to tax laws allowing US companies to bring in cash from overseas at reduced taxes. If this happens, the demand for USD will spike as billions are expected to come in to the US if this change is made. As foreign companies will be buying the USD to bring the cash in. So expect the USD to rise significantly around this news event, and more later if the laws are passed. And this event is expected to happen this year. So fall in the Aussie could be just around the corner, and we may not even have to wait for the US rate hike.
So 2017 will be very interesting for the Australian dollar with plenty of trading opportunities and a lot of volatility
- #101,849
- Jul 16, 2017 7:28am Jul 16, 2017 7:28am
- Joined Jan 2016 | Status: Contrarian Trader | 846 Posts
Price always retraces a little bit, but if anyone is expecting major retracements next week, I am not sure if they will get to see that. There are no indications at least in the charts, unless USD gains strength or Aussie falls on commodity prices. But at the same time it also may not go up. We may see a lot of consolidation (hence ranging), of traders taking profits or short covering. On Tuesday, RBA is releasing its policy minutes and this may cause a retracement (read may and not will). Even though, no one is expecting the US to hike their rates...
As long as it's above 7796 there is no chance of coming back below this level... if the price retraces back and does't break this level then expect it to move beyond 1.xx over two years
Markets are Irrational
{quote} Based on Technicals: As long as it's above 7796 there is no chance of coming back below this level... if the price retraces back and does't break this level then expect it to move beyond 1.xx over two years
This chart says differently. Already there have been multiple rejections at these levels in the past. Why 7796 specifically? I would say the price would need to go below the ascending trend line for the bear trend to resume and bull trend to be negated.
I'm not saying you are wrong, but they are some pretty finite statements on your part.
- #101,851
- Jul 16, 2017 7:40am Jul 16, 2017 7:40am
- Joined Jan 2016 | Status: Contrarian Trader | 846 Posts
{quote} Interesting. No chance? This chart says differently. Already there have been multiple rejections at these levels in the past. Why 7796 specifically? I would say the price would need to go below the ascending trend line for the bear trend to resume and bull trend to be negated. I'm not saying you are wrong, but they are some pretty finite statements on your part. {image}
major or cross... check it yourself any pair any commodity Markets are Irrational
- #101,852
- Jul 16, 2017 7:58am Jul 16, 2017 7:58am
- | Joined Mar 2017 | Status: kcabllup dna tseter | 400 Posts
If I was good in futurology in the medium and long term ... I would bet on these levels .817 and .865
But I'm just a daytrader ... I trade what I see and not what I think
Good week for all
But I'm just a daytrader ... I trade what I see and not what I think
Good week for all
The funniest, is that nobody takes me seriously.
- #101,853
- Jul 16, 2017 8:00am Jul 16, 2017 8:00am
- Joined Jan 2016 | Status: Contrarian Trader | 846 Posts
If I was good in futurology in the medium and long term ... I would bet on these levels .817 and .865 But I'm just a daytrader ... I trade what I see and not what I think
Markets are Irrational
- #101,854
- Jul 16, 2017 8:14am Jul 16, 2017 8:14am
{quote} Historically when price tests a specific level three times.. the third time it smokes it off.. be it any pair
dont smoke it
