AUD USD chart refers to the charts which display the exchange rate of the AUD to USD over a period of time usually in days, weeks, months or years. Study of the exchange rate charts has gained popularity over the years due to the need to adequately plan and execute forex trading strategies which may be new to the trader. In forex trading, there is a great need to be informed about the market value and behavior of currency pairs over time so that they can be traded better and the trader can either decided when to enter or leave the market.
The chart just like the AUD USD chart usually comes in currency pairs to assist the trader in knowing how the pair of interest is faring and how much is needed in order to obtain its equivalent amount in another currency. The exchange rate chart are usually displayed for the purpose of studying the past, present and predicting the future of the currency in question, in this case, AUD to USD. This study goes a long way in serving as a guide to the trader on the best decision to be taken regarding trading in the currency market.
ADVANTAGES AND DISADVANTAGES OF THE AUD USD CHART
The AUD USD chart for exchange rate data has the following advantages to the trader.
1. PROVISION OF INFORMATION
The data being represented in the form of charts makes it easy for the trader to easily understand what the exchange rates looks like without any external help. The data are presented in a simple manner which can be understood even by a novice trader. The simplicity of the data presentation gives the trader an insight into how the currency pair has fared over a selected period of time, say three months for example.
2. IT IS USED IN PLANNING
All forex rates are used for planning and anticipation of the future market in order to derive profit from the invested amounts. The AUD to USD charts come in handy when a trader is trying to plan on how well to enter the market in order to obtain maximum profit.
3. IT IS USED FOR PREDICTION
One of the very important uses of exchange rate charts is for the easy study of the current exchange rates in the currency pair. The trader can be able to correctly predict the market outcome when trading with the currency pair at the time of study.
The major disadvantage associated with the exchange rate charts is that when they are interpreted wrongly, they may give rise to a false negative result when test running a trading strategy.
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.