Advertisement
Advertisement

AUD/USD Forex Technical Analysis – October 16, 2014 Forecast

By:
James Hyerczyk
Updated: Aug 25, 2015, 01:00 UTC

During Wednesday’s volatile trading session, the AUD/USD posted an outside move and a higher close. News that the U.S. economy is weakening sent the

Daily AUD/USD

During Wednesday’s volatile trading session, the AUD/USD posted an outside move and a higher close. News that the U.S. economy is weakening sent the Aussie soaring against the U.S. Dollar. If this trend continues then the Fed is likely to delay its expected interest rate hike, triggering a possible breakout to the upside by the AUD/USD.

A rally over the long-term downtrending angle at .8822 will be the first sign of strength today. This angle actually forms a cluster with an uptrending angle at .8821, making .8822 to .8831 a key area to watch today. Yesterday’s close at .8828 is trading on the bullish side of the cluster, giving the market an early upside bias.

Daily AUD/USD
Daily AUD/USD

The first target is yesterday’s high at .88595. The daily chart indicates that taking this level out could lead to a test of the last main top at .8898. A trader through this level will turn the main trend to up on the daily chart.

Taking out .8898 with conviction should lead to a test of the steep uptrending angle at .9002. If buyers can overcome this angle then look for the move to continue into the major retracement zone at .90215 to .9111.

Breaking the possible support cluster at .8822 to .8821 will put the market in a weak position with .87745 the first downside target. This is followed by uptrending angles at .8732, .8687 and .8665.

If the two bottoms at .8651 and .8642 fail to hold then look for a resumption of the downtrending with the monthly 50% level at .8544 the next likely target.

The tone of the market today will be determined by trader reaction to .8822 to .8821. If data continues to suggest the U.S. economy is weakening then look for the AUD/USD to rally into at least .90215 to .9111 over the near-term. 

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

Did you find this article useful?

Advertisement