AUD/USD Forecast October 8, 2014, Technical Analysis

The AUD/USD pair rose during the course of the day on Tuesday, but ran into enough resistance just above the 0.88 handle that the market stopped. If we can get above the top of the range for the session on Tuesday however, we feel at that point in time that the market would probably head to the 0.90 level. At that area, we would expect a significant amount of resistance and therefore we think that any buying opportunity is going to be short-term in nature at best. On the other hand, if we get a bit of a rally and a resistant candle, we would be more than willing to sell it as the market should continue to go lower. We still believe that this market could go as low as 0.80 given enough time, but certainly at this point in time it would make sense to see a bit of a bounce.

Australian Employment numbers come out during the course of the day today, so course that could have a pretty significant effect on the Australian dollar overall. With that, we will wait to see what the numbers are, anticipated to come out as losing 30,000. Anything better than that could send this market raising towards the 0.90 level, just as anything worse than that could collapse the market.

Ultimately, we still think that the matter what happens, the Australian dollar will continue to be sold off from the longer-term. Because of that, we are very bearish of the Australian dollar at this point in time, and recognize that anytime this market rallies it will be treated with suspicion at best. The market has struggled for some time now, so again if we get some type of rally that is going to be short-term in nature in our opinion. We do believe that a longer-term bottom is probably going to be found somewhere closer to the 0.80 handle, as it was such a major resistance barrier a few years ago. Ultimately, at that point in time we might be looking at a longer-term buy-and-hold situation, but we are a long way from there.