What Rising Australian Stock Market Could Mean For The AUDUSD!?

Today decided to look at the Australian stock market where we can see a pretty strong impulsive rally that should move even higher as we need five waves from early April low. Maybe you are wondering how this will impact the AUDUSD?! We suspect that if investors will keep their money in shares; which is expected based on the price action, then there will be no demand for cash (AUD) which may keep AUDUSD below resistance. On the other-hand, only if investors will start to sell their shares then they would exchange them for Australian dollars which will most-likely increase its value. So for now when Australian stocks are higher the AUDUSD could go even lower if we consider the negative correlation between the markets as shown on the overlay chart below.

ASXSP200 4h

Australian stocks vs. AUDUSD

CRUDE OIL Turned Bullish Last Week; Could See $95.00

OIL has accelerated higher on Thursday, and more importantly it closed well above the upper parallel trend-line of a base channel. Thats a very strong indication of an impulsive recovery, becasue this break (circled) usually occurs in the middle of a wave three of a five wave rally. As such, we have now turned bullish on crude. If we are correct, then price will reach higher levels, possibly around 95.00 in this week, especially if we consider that pull-back from the top already has signs of a corrective movement. Ideally thats wave iv) of an impulsive uptrend. Support comes in around 91.50; at 38.2% Fibo level. 

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GBPUSD: Corrective Rally From March Low Could Now Extend To 1.5500/1.5600

GBPUSD finally broke higher yesterday after recent unsuccessful push through the lower support line connected from early March lows. Notice that pair closed well above 1.5407 trend-line yesterday which sets a stage for a new impulsive rally, now towards 1.5500/1.5600 area. This leg represents wave C), final sub-wave of a second zig-zag in wave II, so we must be aware of a bearish price action, most-likely next week. 

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Crude Oil Is Looking Impulsive On the Intra-day Basis; Could See $93.00

Oil is forming an impulsive price action from 87.87 swing low. The reason is recent strong reaction towards 92.00 figure yesterday which has been very strong and sharp in short-period of time. That’s a personality of a third wave, so we think that market is forming a five wave pattern. With that in mind, be aware of more upside, this time towards 93.00 mark. Current sub-wave four may look for support around 91.00 level. Market remains in bullish shape as long as 89.92 support is not breached. 

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