Aussie Dollar, Gold Look Positive As Bulls Gain Strength
The AUD/USD pair fell down to fresh multi-year lows at 0.7214, but erased most of its weekly losses by the close. The Aussie was among the most affected by China’s devaluation, but ever since RBA’s Governor, Glenn Stevens, said that the AUD depreciation has done enough to help the country’s economic growth, market sentiment has flipped to bullish for the antipodean currency.
Still, the pair is unable to advance beyond the 0.7400 level, with intraday sellers taking their chances around the level. Nevertheless, the daily chart shows that the pair has managed to hold above its 20 SMA that lost its bearish slope and now stands flat around 0.7335, providing an immediate support.
In the same chart, the Momentum indicator presents a mild bullish tone above its 100 level, whilst the RSI indicator remains flat in neutral territory, still failing to confirm a more sustainable rally.
Shorter term, the 4 hours chart shows that the price develops above a bullish 20 SMA, although the technical indicators stand around their mid-lines, with the Momentum indicator presenting a strong bearish slope, coming from overbought levels, suggesting the pair may fall in the short term.
In the same chart, the 200 SMA stands now around 0.7415, offering a strong dynamic resistance, and a line in the sand, as the pair has remained below it since late June. Some follow through beyond the MA should signal an upward continuation towards the 0.7500 region.
Meanwhile gold prices edged flat on Friday, but closed the week with gains for the first time in over a month, as uncertainty surrounding a US rate hike next September and Chinese turmoil favored the safe-haven asset.
Spot gold closed the week around $ 1,115.00, down from a weekly high of 1,126.69, and the daily chart shows that further gains are possible, as the metal trades above a mild-bullish 2 SMA, whilst the technical indicators are regaining the upside after a limited downward correction in positive territory.
In the 4 hours chart the price is now around a mild bullish 20 SMA, whilst the Momentum indicator heads lower below the 100 level, but the RSI indicator heads higher around 55, limiting chances of a stronger decline.
Additionally, the metal holds above the 1,110.00 region, a former strong resistance level, and it will take a clear break below it to deny chances of additional gains.