AUD/USD Weekly Price Forecast – Australian dollar forms supportive candle

The Australian dollar initially fell during the week but found enough support underneath the turn things back around and form a nice-looking hammer. With this, it’s likely that we will continue the overall consolidation.
Christopher Lewis
AUD/USD weekly chart, October 07, 2019

The Australian dollar has gone back and forth during the week, but eventually settled on a hammer which of course is a very bullish sign. At this point, the market is likely to continue to find the consolidation area of interest attacked in both directions. The 0.67 level continues to be massive support, while the 0.69 level above is massive resistance. It’s very likely that the market will continue to see players come back into this market in a back-and-forth type of manner. We are essentially close to “fair value”, so having said that it might be difficult to deal with. Longer-term traders may have to drop down to the daily chart, and at this point it’s likely that you should use these boundaries from the weekly chart for a bit of a guide to where to go next.

AUD/USD Video 07.10.19

If we did break down below the bottom of the hammer from the weekly chart, that could be an extraordinarily bearish move, perhaps driving down to the 0.65 level. On the other hand, if we were to break above the top of the candle stick for the week, the 0.69 level will be targeted. Expect a lot of volatility, but with the US/China trade talks starting again next week, this pair could be very volatile. The fact that we are so clearly defined as to support and resistance, it makes quite a bit of sense that we will continue to see noisy trading in this relatively tight range. However, once we break out of this range, the market could go rapidly in one direction or the other.

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