Good day forex traders and readers.
Welcome to another edition of our weekly forecast of the AUD/USD and EUR/USD.
In the previous AUD/USD forecast we noted that the currency pair was bullish again for the week. As predicted in the previous forecast, 0.94 resisted the prevailing bullish pressure and the AUD/USD ended just below it. The upcoming week would be crucial for the currency pair as we observed the reaction of 0.94.
In the previous EUR/USD forecast we noted that the currency pair was indeed bearish for the previous week. Our forecast was right on target. The bottom bollinger band would remain as our immediate support for now. Any breach would open up extended bearish targets like 1.34 / 1.32.
Looking at the AUD/USD weekly chart above we note that the currency pair was trading in a narrow range. The currency pair remained suppressed by the 0.94 resistance and again this would be a crucial point to observe for the upcoming week. Any bullish pressure will definitely need to conquer this region of resistance first.
Looking at the EUR/USD weekly chart above we note that the currency pair attempted to recover from it bearish dip.
It is currently within the bottom and middle bollinger bands and both would serve as support and resistance respectively for the upcoming week.
It was a week of the central banks! Two key events pretty much shaped the stance of the currency pairs. The Reserve Bank of Australia was rather dovish on the economic outlook and this caused a dampening sentiment among investors and traders. With the monetary policy under going a cut, Australia is likely to face some humps.
The US Federal Reserve was also rather held back in it’s statement. A slow but steady improvement was noted for the US economy. Bond purchase reduction is to continue and interest rate is likely to be increased next year. Investors probably took this development in a negative outlook and the US dollar received a sell off.
Next week brings many economic releases for the euro region and US. These events may shape sentiments and hence proper money management is a must. Be careful of unexpected developments due to the events.
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