Good day forex traders and readers.
Welcome to the weekly AUD/USD forecast review specially for you readers of TheGeekKnows. You might have seen pieces of our articles syndicated across the Internet but you only get the full review here at the Koala Hut ! And I hope you had a fantastico week harvesting pips!
In the previous AUD/USD forecast we noted that the currency pair faced a bearish support and should a correction happen, the extended bullish target could be 0.9320. In the meanwhile fundamentals show us that the RBA continues to adopt an accommodative stance to support the weaken Australian economy
Looking at the AUD/USD daily chart above we note that the currency pair did test the 0.9320 region and hence my forecast was spot on. I love it when it works. But again as I always mentioned, nothing in forex is 100%. If a forecast was correct, great! If it is wrong, we learn from it and thank ourselves for proper money management. 🙂
The return to the previous week’s trading levels suggests that the bearish pressure is strong. It would be more crucial now to note the current support. 0.9 would probably be strong and an extended bearish support may be 0.8900.
Should the bearish momentum fail again, we got 0.9320 right back on our sights 🙂
This week saw a number of interesting events that were influential to the AUD/USD.
The US Federal Reserve chairman Ben Bernanke indicated his dovish stance towards impending the quantitative easing tapering in the near future. The idea of having interest rates remaining low for the short to medium term was brought up too. This is opposite of what was suggested weeks ago and the markets basically took this as a reversal of approach and the market moves we had seen this few weeks basically reversed. For example the AUD/USD was climbing midweek.
China indicated that it’s economy was able to manage even if growth drops to 6.5% compared to the current estimates of 7.5% . The markets probably took this as a hint of sorts for a forecast downgrade. This disappointed the markets and caused risk aversion. This is especially for the AUD/USD as China is the largest trading partner for Australia. This probably sent the currency pair nose diving back to levels seen last week.
The Rsserve Bank of Australia RBA recent meeting minutes will be released early week and I urge caution as many would going through the details thoroughly in search of indications of possible future policy actions.
Refer to the weekly pivot data for the AUD/USD below for some possible indications of support and resistance.
R3 0.9409 R2 0.9331 R1 0.9193 PP 0.9115 S1 0.8977 S2 0.8899 S3 0.8761