Yahoo Finance AUD/USD forecast for the week of October 30, 2017, Technical Analysis
The Australian dollar broke down significantly during the week, slicing through what I see as a major support level. This was an area that was massively resistive in the past, and a breakout above there was a very extraordinarily bullish sign. Now that we have broken back below there, I have to admit this is a very bearish looking move. On the daily chart, looks as if we are trying to form some type of hammer, so we could rally but I think the rally will probably find significant resistance near the 0.7750 level. Alternately, if we break down below the bottom of the weekly candle, and by extension the 61.8% Fibonacci retracement, the market probably drops significantly from there. Pay attention to gold, it will give us a heads up on where were going next.
Ultimately, the Australian dollar is a proxy for not only gold, but Asian growth. I think risk appetite will also have its influence, so if the markets rally, it’s likely that we will find this market going higher, but I think that the overall attitude of the US dollar is to strengthen, so I’m a bit suspicious of this market currently. The market pulling back completely would send this down to the 0.73 level, and that of course is going to be massively supportive as it was the beginning of the surge higher. Ultimately, I think the one thing you can count on is a lot of noise, but I think that the longer-term investor will probably have more of a clear-cut signal at the end of the week, as we determine whether or the sellers continue to run the show, or if we get a resurgence of bullish pressure. If we were to clear the 0.78 level, then the market probably goes back to the 0.80 level.
This article was originally posted on FX Empire
