Good day forex traders and readers.
Welcome to the weekends! I hope you are had a good forex trading week. No matter how small or big your profit is, as long as it is a gain of pips, good job to you I would say!
In the previous AUD/USD forecast we noted that the extended bearish target might be 0.9380 if the currency pair continued to experience weakness. Fundamentally the Australian equities index ASX 200 was red and China’s economic figures continue to disappoint.
Looking at the AUD/USD daily chart above we note that the currency pair did test our extended bearish target which I mentioned last week. I made some pips from this and I hope you did too 🙂
The currency pair had since eased back up and is now testing the immediate resistance of 0.9610. It is crucial that we monitor this resistance line as a failure will no doubt suggest the possibility of targeting 0.9380 again. If the bullish momentum does gain in strength, 0.9710 would probably be next.
With regards to the bollinger bands, we note that the middle band is functioning as a strong resistance for the bearish trend so far and hence it is important to monitor this too.
The Australian employment figures was better than expected and this probably contributed to the bullish bounce off 0.9380. Having said so global markets worldwide including Australia continued to face risk aversion pressure as investors rush to reposition themselves in anticipation of any quantitative easing reduction. Such sentiments are dampening the markets now and hence limited the AUD/USD climb.
Besides the speculation that the US Federal Reserve would comment on their future plans towards the quantitative easing this coming week, the Reserve Bank of Australia is also due to release their meeting minutes which might hold clues to their considerations and plans for the Australian economy. Do monitor and be prepared for unexpected spikes.