The Weekly Volume Report: Volume Spikes With Spot
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Talking Points
Another high volume reversal in AUD/USD
Capitulation high in the euro?
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Daily Volume Chart: EUR/USD
Charts Created using Marketscope – Prepared by Kristian Kerr
EUR/USD underwent extreme volatility this past week as spot traded in a five big figure plus range
A sharp spike in volume on the move to 1.1700 warns of a potential upside capitulation
The divergence in daily OBV on the spike higher relative to the May high is also negative
A close below 1.1000 on above average volume is needed
Daily Volume Chart: USD/JPY
Charts Created using Marketscope – Prepared by Kristian Kerr
USD/JPY fell to its lowest level more than 7-months this past week before recovering the bulk of the week’s losses
The increase in volume on the spike lower and recover warns that capitulation low of some kind was traced out
Unlike in the euro, USD/JPY did not record an OBV divergence against its most recent low which is a potential negative
However, a close above 123.00 on above average volume is needed to confirm a more important shift higher in the exchange rate
Daily Volume Chart: AUD/USD
Charts Created using Marketscope – Prepared by Kristian Kerr
AUD/USD traded down to its lowest level in over six years this past week
A trio of above average volume spikes on recen wide range days suggests the exchange rate is nearing an exhaustion point
However, a strongly trending daily OBV line suggests the downtrend remains firmly entrenched
A daily close over .7300 on above average volume is needed to turn the outlook more positive
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--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com
To contact Kristian, e-mail kkerr@fxcm.com. Follow me on Twitter @KKerrFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
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