Forex Ichimoku – Kumo Break for Aussie | Oct. 2nd

AUDUSD
Following the 25bp cut by the RBA yesterday, the Aussie has been feeling it, losing about 100pips on an open to close basis.  In the process, the pair formed a daily kumo break setup closing below the cloud for the first time since June this year.  In addition to this, it also formed a medium tenkan-sen kijun-sen cross to the downside which further adds to the bearish picture.  The chikou is not below the kumo, nor even entered it yet, so not in a full bear trend, but the pressure is on.

Ichimoku Wave Structure suggests we are in a possible Y-Wave in the 4th leg of it, so likely at least one more leg before a breakout.  Kumo break traders can look for a rally to short around 1.0321 targeting the Sept. lows at 1.0175.

ichimoku kumo break y wave chikou 2ndskiesforex.com oct 2nd

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Global Market Commentary:
The RBA cut rates by 25bp yesterday which sent the Aussie tumbling on the day.  Housing prices also in the UK slumped printing a -1.4% number which is double the expectations at -.07%.

The main thing on investors minds is Spain requesting a bailout which is all but certain at this point as their banks were shown to be undercapitalized by almost €59B which I expect the actual number is about double that.  If they request a full bailout, that should be a risk on event so expect the USD to lose ground in the process.

The Dow Jones closed down about 32pts while Gold trotted in place closing up about $.50

Upcoming Economic Announcements:

CNY Non-manufacturing PMI 21.00EST
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AUD Trade Balance (Australian dollar) 21.30EST
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EUR Euro-Zone Purchasing Manager Index Composite 04.00EST
GBP Purchasing Manager Index Services 04.30EST
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USD ADP Employment Change 08.15EST
USD ISM Non-Manufacutring Composite 10.00EST

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  • Gabriel

    Very interesting to see how the Chikou treated the candles as resistance on this latest move down. Would be interesting to see price retrace to the flat Kumo bottom, and Chikou meet some more candle resistance around the same level, before continuing to sell off.