Good day forex traders.
Welcome to another update of the AUD/USD. I hope everyone is having a good weekend so far. If you lost money during the trading week, i hope everything is ok. Do remember that proper money management is always a must.
In the previous AUD/USD forecast we noted that the currency pair was knocking at the 1.0430 support’s door. Spanish bailout rumours and more were dampening sentiments and exerting a downwards pressure on the currency pair.
Looking at the AUD/USD daily chart above, the currency pair did slip lower below 1.0430 and tested the next support at 1.0330. I LOVE IT WHEN MY S&R LINES WORK 🙂
The short term trend seems to be bearish as the global markets continue to be affected by apprehension. I expect the 1.0330 to continue to offer a support of sorts but if the bearish trend intensifies, 1.02 may be the next extended bearish target. Needless to say, a bullish come back will open up 1.0430 and then the next upper resistance as seen above.
The current market sentiments are more of a risk off nature. Contrary to the previous bullish rally, it was quick to recede. This is probably due to the fundamental issues of the US and Euro Zone. Both economies remain challenged by their respective issues. Euro zone by the budget deficits of the various member nations and the US by a weak employment and housing market.
Recently China is facing an increasing challenging economic environment. Being an export driven economy, the global economic slump affected the growth of the Middle Kingdom. This affected Australia’s trade too as it’s largest trading partner is China. On a bright note, the Chinese did mention stimulus measures and investors are probably counting on that to happen soon.
I personally like this pair as it comparatively less volatile than the EUR/USD. Having said so I urge caution for everyone as the global sentiments are depressed and year end is approaching.