ALB Limited 06.10.2020
Chart of the Day AUDUSD Australia Interest Rates Unchanged
With the Reserve Bank of Australia keeping interest rates unchanged at 0.25% in an attempt to shore up its economy ravaged by the effect of the coronavirus, which has led to high unemployment and a deficit of AUD 200 Billion for its 2020/2021 budget, there is the possibility that the rally seen from the lows made on 19/03/2020 at 0.55073 to the most recent high at 0.74134 on 01/09/2020, may perhaps be on the verge of resuming its downtrend. Price has been unable to sustain a close above the 200 weekly EMA. Since the swing high was made on 01/09/2020, the price has made lower lows and lower highs. With the price currently around 0.7150, we did see range-bound trading in this area from 22/07/2020 – 27/08/2020. Hence, there is the possibility of going into a range-bound market once again. However, it is more likely that we will see a trend emerge. The Dollar index is currently around 93.50 on the back of positive news that U.S. President Donald Trump was discharged from the hospital and has returned to the White House. The current Dollar Index price level is an area where we have seen support historically such as on 16/09/2018. It is also in an upward-sloping channel and even though it closed outside of the channel yesterday and traded below its daily 9,20 and 50 EMA, I do expect this level to hold. The U.S. elections are increasingly becoming a focus and Dollar Index strength could have major implications on the indices and precious metals.
