Intraday Market Thoughts

Archived IMT (2010.08.10)

by Ashraf Laidi
Aug 10, 2010 17:06

BEARISH STOCHASTIC DIVERGENCE in AUDJPY as the cross stands vulnerable to prolonging losses on deepening risk aversion, especially after Chinas July imports were slower than expected. The daily AUDUSD chart shows a rare bearish divergence in slow stochastics, whereby the price action remains consolidative despite a decline in stochastics. In such cases, price have often turned into the direction of the oscillator (stochastic). With AUDJPY currently testing the July 6 trend line support (78.10), it risks retesting 77.30-35 support, a break of which would spell a retreat to 76.20s. Upside seen capped at 78.50s.


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