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AUD/USD Forecast Review 28 May 12

 

Good day forex traders.

 

Had a good trading week? I certainty hope so. The Australian dollar is dropping and even a sleepy koala will probably notice that trend!

In the previous AUD/USD forecast review, i attached a simple chart to highlight the bearish nature of the trend. 0.96 was a possible extended target. Risk aversion was strong and hence high yielding assets such as the Australian dollar would experience an outflow of funds.

 

AUD/USD Bearish

 

Technical Analysis

The AUD/USD continues to be bearish and had since went below 0.98. I LOVE IT WHEN MY TECHNICAL ANALYSIS WORKS. yay!

SMA 20 = Bearish

SMA 50 = Bearish

Both SMAs are bearish and the chart action is bearish too. One may wonder why is the SMA 200 still somewhat flat? As it is a simple moving average of the last 200, it factors in a long period of time and the AUD/USD is actually in a huge range for a long time now. ( We are testing the bottom of it at the moment )

The currency pair has moved into the previous bearish channel as shown above. The 0.96 bearish target remains if the momentum continues but there may be some bumps as the current currency price region was a previous low.

 

Fundamental Analysis

Among the usual concerns of the euro zone budget deficit crisis, of greater worry will probably be it’s effect on Asia as a whole.

China is displaying further signs of slowing down. Recently it was reported that the loan demand has fallen.

Being a large trading partner of Australian, this does not bear well with the Aussie economy. While we are pretty such of China’s actions to prop up it’s slowdown, it is often the sentiments that destroys.

Commodities prices worldwide such as copper are taking a hit due to the global economic slump. Being a commodities economy, Australia suffers.

The S&P / ASX 200 has dropped a far bit and is now about to test the support of 4000.

 

Trade Safely.

 

Related Forex Articles from the Koala Forex Training College.

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