AUDUSD: Forex Technical Analysis – Accelerating growth bullish for AUDUSD

By IFCMarkets

Accelerating growth bullish for AUDUSD

First quarter GDP was better than expected. Will the AUDUSD climb continue?

The Reserve Bank of Australia left the interest rate at 1.5% and the policy unchanged at its June 5 meeting. The GDP report next day was better than expected: the Australian economy grew at 3.1% annual rate in the first quarter of 2018 after a 2.4% growth in the last three months of 2017. The increase in exports was the main driver of growth. Accelerating economic expansion is bullish for AUDUSD.

On the daily timeframe AUDUSD: D1 is rebounding after hitting thirteen-month low in the beginning of May.

• The Parabolic indicator has formed a buy signal.
• The Donchian channel indicates no trend yet : it is flat.
• The MACD indicator is above the signal line with the gap widening. This is a bullish signal.
• The stochastic oscillator is in falling and has not reached the oversold zone.

We believe the bullish momentum will continue after the price breaches above the upper Donchian boundary at 0.7676. This level can be used as an entry point for placing a pending order to buy. The stop loss can be placed the below the lower Donchian channel at 0.7476. After placing the pending order the stop loss is to be moved every day to the next fractal low, following Parabolic signals. Thus, we are changing the probable profit/loss ratio to the breakeven point. If the price meets the stop-loss level (0.7812) without reaching the order (0.7551) we recommend cancelling the order: the market sustains internal changes which were not taken into account.

Technical Analysis Summary

Position	Buy
Buy Stop	Above 0.7676
Stop loss	Below 0.7476

Market Analysis provided by IFCMarkets