 Hello, welcome to this week's CMC markets currency snapshot with myself Jasper Lawler this week We're going to be talking about the Aussie namely the Australian dollar US dollar exchange rate and What's interesting there is there's coming a slightly different picture between the two central banks and this isn't the picture of an 8% fall in this exchange rate in just a month so as mentioned there has been a rapid drop in the Australian dollar US dollar exchange rate and This is largely thanks to a strength in the US dollar across most major currencies and The thought process that the Federal Reserve are going to be one of the first central banks around the world to to raise interest rates And so the idea being that US interest rates are on the way up But at the time Australian dollar Australian interest rates are thought to be perhaps more likely to be on the way down That has slightly changed since the last RBA Reserve Bank of Australia meeting last week What they've essentially indicated and what the takeaway from that meeting was is that interest rates? Although not likely to rise perhaps in the near future. They're unlikely to be going down They're basically going to be holding rates flat at the current rate for the foreseeable future And last largely Surrounding the fact that the Australian economy has rebalanced a bit it's not so focused on commodities these days and so the economy is doing well and Also the idea that the the housing market is actually booming over there So really you can't cut interest rates in the face of a booming housing market It's just going to encourage a further excesses in that particular market So that's the Australian economy And so that already brought us down to the exchange rate at that point was already at the 2014 low For the Aussie down 8% in just a month But now just yesterday we've had the minutes from the Federal Reserve in the US and they were much more dovish than People were anticipating and they've actually specifically alluded to strength in the US dollar as a problem Potentially for the US economy. So that caught people off guard And so now this slight bounce that we've seen off the 2014 lows Looks like it's following through a bit and so we're going to have a look at the chart pattern now to see where we We're out on that particular currency pair. So here we have the Aussie dollar daily candlestick chart Now you can see this massive plummet down in prices that we saw that came down and hit a low at 86 60 We bounced off there to 88 25 which was a price pivot from back in 2012 We came back down again to the low successfully tested it and have moved up higher through that 88 25 level again So in the shorter term chart, you would see that as a bit more of a clearer double bottom pattern So if that pattern is to come to fruition, we could see prices move up to 89 the 89 85 type area was where the prices broke down quite significantly mid September so that alongside the bullish RSI divergence that we've seen with the lower lows being made in the price recently, but that flat RSI pattern Could see further prices further bullish moves in the price going forward Okay, that's it for this week's CMC markets currency snapshot. We were of course looking at the Aussie dollar Now keep it a lot keep an eye on this 86 60 which is this 2014 low that we've recently bounced off. That's a key level on the chart But also keep an eye on the rhetoric coming out of both the RBA and the Fed for the moment The balance has slightly changed towards more favorable Australian dollar outlook, but obviously we have to pay attention to everything they say This correction could could be short lived should there be a short, you know changing in rhetoric between these central banks