AUDUSD has been moving in a downward trend for over two years and has lost over 1400p since 21.01.2018. On Monday the pair set a minimum of this year, which today during the Asian session was deepened to 0.6677. At 4:30 am we learned the decision of the RBA – the central bank of Australia, which decided not to reduce interest rates and leave them at 0.75%.
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After this information, the Australian dollar started to gain against the US dollar. Currently, today’s daily candle indicates the creation of a bullish engulfing formation. The previous such a formation established at the turn of August and September 2018 led to 130p increases (red rectangle in the chart).
If the breakout from this formation will be supported by setting a minimum on MACD and the oscillator will enter the upward phase, based on the assumptions of my PA+MACD strategy, this will be a signal for an upward correction. The expected demand target may be the nearest important S/R level – 0.9800. It has already been tested many times before as support and resistance and this time it may work as resistance.
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