AUD/USD Is Breaking Out Of An Ending Diagonal
The USD is moving lower despite the recent sell-off on stocks. It appears that the USD found resistance as investors assume that FED can not do much against higher inflation. Also, the long dollar trade following high US CPI figures last week was "overcrowded" and simply it does not work. What we noticed and tracked closely recently, was a five wave rise on DXY, so we were looking for limited upside.
So far, we can see a nice turnaround on DXY, below the channel support which suggests more weakness in sessions ahead (chart in yellow).
And now, as the USD moves lower, the speculators may look toward commodity currencies. Aussie in fact has some nice recovery from the low and out of the wedge, which signals for more gains in sessions ahead. Also, RBA remains committed to doing everything possible to ensure that Australia's inflation returns to target over time. They also discussed the potential of hiking interest rates by 25 or 50 bps. From an Elliott wave perspective, we shall see further gains on AUDUSD after a-b-c pullback.
Grega
So far, we can see a nice turnaround on DXY, below the channel support which suggests more weakness in sessions ahead (chart in yellow).
And now, as the USD moves lower, the speculators may look toward commodity currencies. Aussie in fact has some nice recovery from the low and out of the wedge, which signals for more gains in sessions ahead. Also, RBA remains committed to doing everything possible to ensure that Australia's inflation returns to target over time. They also discussed the potential of hiking interest rates by 25 or 50 bps. From an Elliott wave perspective, we shall see further gains on AUDUSD after a-b-c pullback.
Grega
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