Good day forex traders and readers.
Welcome to our weekly forecast review of the AUD/USD.
In the previous AUD/USD forecast we noted that the currency pair was again bearish for the week. It was at 0.7369 and below the bottom bollinger band. The extended bearish target of 0.72 was within reach and continued bearish pressure would likely achieve it. With the price action below the bottom bollinger band, many analysts were looking out for a bearish trend.
Looking at the AUD/USD weekly chart above we note that the currency pair was again bearish as expected. It is now just off the extended bearish target of 0.72.
The AUD/USD has been bearish for over a month now. From a technical point of view the bearish indications are strong. Having said so just be mindful of any unexpected developments. Bullish correction target remains at 0.75.
The sentiments surrounding the Australian economy remain dampened due to the China equities market crisis and depressed commodity prices. In this week, gold has dipped further and is approaching $1000 usd.
It was reported that ratings company S&P indicated that Australia may be downgraded should their budget remains a concern. This probably further lowered sentiments.
We noted that the Rsserve Bank of Australia previously mentioned that a lower Australian dollar seemed both likely and necessary. This apparently continued to drive the bearish momentum as observed.