AUD/USD Forecast Nov. 23rd, 2011, Technical Analysis

AUD/USD fell again on Tuesday, albeit only by a small amount. The pair looks vulnerable at the moment, and the “risk off” attitude of the global markets will not be very conducive to the buying of the Aussie dollar. However, we do see a lot of support between present levels and the 0.95 level, and therefore will be selling rallies, not shorting here. Buying isn’t possible with all of the headline risks out there presently.

AUD/USD Forecast Nov. 23rd, 2011, Technical Analysis AUD/USD Forecast Nov. 23rd, 2011, Technical Analysis

AUD/USD Forecast Nov. 22nd, 2011, Technical Analysis

AUD/USD fell hard on Monday as traders continued to sell of the risk trade. The Aussie will always be sensitive to sentiment, and sentiment is poor at best lately. With this in mind, we sell rallies, and have no real interest in buying the Aussie at all. The area below is still in the massive support zone down to 0.95, and could produce pops in the market. Those we continue to be sold by us in the near-term.

AUD USD Forecast Nov. 22nd, 2011, Technical Analysis AUD USD Forecast Nov. 22nd, 2011, Technical Analysis

AUD/USD Forecast Nov. 21st, 2011, Technical Analysis

AUD/USD fell during the session on Friday after an initial bounce to form a shooting star. The pair looks weak, and the rallies are all being faded at this point. The parity level should offer some support, and we think that another bounce could be coming just under this area, perhaps at the 0.99 level. However, as long as the headline risks out there keep coming, the pair will continue to grind lower. This pair is very popular, so be aware of the fact that the move down will more than likely be a grind, not a sudden move. We sell rallies, and do not buy this pair.

AUD/USD Forecast for the Week of Nov. 21st, 2011, Technical Analysis

AUD/USD fell very hard during the week as traders continue to shun the riskier assets around the world. The Aussie is very risk-sensitive, so the fall was to be expected. The parity level is currently holding up the pair as support, and looks like the start of tough support coming up. With this in mind, this pair is a sell – but should be more of a grind than a sprint south form here. We like selling rallies as well, but don’t buy. If the parity level gives way with any meaning, the 0.9350 level will be targeted, but could take some time to reach.

AUD/USD Forecast Nov. 18th, 2011, Technical Analysis

The AUD/USD pair broke below the parity level on Thursday, and continued its bearish tone overall. The 0.99 level below should be somewhat supportive, and if that area gives way – this pair should fall much, much lower. The upside is going to be difficult in this pair at this point in time as it is so risk sensitive. The world’s markets are getting nervous, and this is never a good thing for the Aussie. We like selling a break below 0.99, and any rallies that present themselves.

AUD/USD Forecast Nov. 17th, 2011, Technical Analysis

The AUD/USD pair fell again on Wednesday as traders sell off risky assets. The pair is presently supported at the parity level, and that will be the key to our next trade in this pair. At present levels, we have no trade, but would be interested in buying on supportive candles at parity, or selling if we close below that level. Until then, we are sitting tight in this pair. Even with a pop higher, we think that the 1.05 level is the top of the market for a while.

AUD/USD Forecast Nov. 17th, 2011, Technical AnalysisAUD/USD Forecast Nov. 17th, 2011, Technical Analysis

AUD/USD Forecast Nov. 17th, 2011, Technical Analysis

AUD/USD Forecast Nov.16th, 2011, Technical Analysis

The AUD/USD pair fell on Tuesday, but bounced at the end of the session to form a hammer. The bullish candle looks as if it is reiterating the support at the 1.01 level. The pair has been grinding lower over time, and we think that trend could continue, but there looks to be a bounce in the short-term. Because of this, a buy signal is generated if we break the top of the Tuesday session. The move could signal a run to 1.04 or so, but we think it is just a short-term trade at this point. With the Aussie being so sensitive to headline risk, we are not inclined to own it for too long. A break below parity has us selling.

AUD/USD Forecast Nov.16th, 2011, Technical Analysis

AUD/USD Forecast Nov. 15th, 2011, Technical Analysis

AUD/USD fell on the Monday session as risk assets sold off around the globe. The pair is highly sensitive to this kind of fear, and sold hard as a result. The parity level below looks very supportive, and the 1.01 level has been pretty active for buyers as well. The market is absolutely out of control in general at the moment, and this pair will be very dangerous as a result. The pair can’t be sold until we are under that parity level, so we are looking to see if there are supportive candles in the near-term.

AUD/USD Forecast Nov. 15th, 2011, Technical Analysis

AUD/USD Forecast for Nov. 14th, 2011, Technical Analysis

The AUD/USD pair rose during the Friday session as the manic attitude of currency markets continues. The Greek swore in a new Prime Minister, and the Italians passed an austerity budget. The trading took this as the EU being saved. (Again.) Of course, there are a lot of details missing from the bailout funds, and the market is probably vulnerable to headline risks at this point because of the violent nature of the move. We see resistance ahead, and will be looking to sell near the 1.04 – 1.05 area if we get the correct price action.

AUD/USD Forecast for the Week of Nov. 14th, 2011, Technical Analysis

The AUD/USD pair fell during much of the week, but got a bounce to form a hammer just above the parity level. This bounce shows that there could be massive buying of the Aussie as the “risk on” trade continues due to the situation in Europe being worked on. The markets are going into a relief rally mode, and as a result we see riskier currencies like the Aussie get bid up. The 1.05 area above does look a bit resistive though, so we don’t want to buy until we close over that level. Once that happens, we will be aiming for the 1.10 level. Selling isn’t possible until we close below the parity level.

AUD/USD Forecast Nov. 11th, 2011, Technical Analysis

The AUD/USD pair fell and rose during the session on Thursday as the headlines continue to push this pair around. The 1.01 to parity levels are one big support zone in our opinion, and we think they could possibly give the bears a hard time. The resulting candle was a doji, which is easy to understand. The breaking of the highs of the candle will be a bullish sign, and a breaking of the bottom would be bearish, although we would have to see a close below the parity level to seriously consider selling at this point.

AUD/USD Forecast Nov. 10th, 2011, Technical Analysis

AUD/USD fell hard on the session for Wednesday as traders have sold off all things related to taking risk. The Aussie is very susceptible to headline risks, and as a result this pair didn’t act well to Italian 10 year bonds yielding over 7% during the European session. The pair fell back to the 1.01 level, and we have this level down to parity as one big support level. The real question now is whether or not it will hold.  We think there are far too many headwinds in the economies of the world to take a long in this pair, but the selling of it would be very difficult at this level. With this in mind, we are waiting for a rally to sell, or a daily close below parity to sell.

November Forecast – AUD USD

Monthly AUD USD Pattern, Price & Time Analysis

The AUD USD followed through to the downside in October, confirming its main top at 1.1080.

The 50% to 61.8% target zone of the .8067 to 1.1080 range provided support between .9573 – .9218 respectively with the low coming in at .9387. Uptrending Gann angle support at .9427 was another downside target that was tested and recovered.

A new short-term range was created between 1.1080 – .9387. The retracement zone of this range is 1.0233 to 1.0433. The rally through this zone was impressive, but it probably was triggered by short-covering rather than new buying. Given the volatile situation in Europe, it’s hard to believe that fresh buyers were interested in the long side at these lofty levels.

Although the main trend is up, the AUD USD is not likely to break out to the upside. This current rally is most likely to turn into a counter-trend selling opportunity.

The major concerns this month for the Australian Dollar are the uncertainty in Europe and a weakening Australian economy. For several months the world has been held hostage by the sovereign debt crisis in Europe. Although a plan has been laid out to recapitalize the banks, give a bailout fund more fire power, and restructure Greek debt, the European are having trouble funding this plan. In the meantime,Italy is making noise which could mean it will be looking for a bailout also.

Some traders are asking, “what does Europe have to do with Australia?” The link between Europe and Australia is China. Europe is a huge customer of China. If the debt crisis sends Europe into a recession then the flow of money between Europe and Asia will slowdown. A weaker China could spread to the Pacific Rim, namely Australia and New Zealand. China will demand fewer raw materials which will have a direct effect on Australia.

This being said, the Reserve Bank of Australia is likely to cut interest rates if it sees its economy weakening. This could lead to liquidation of the AUD USD by those who sought its higher yield.

Since the situation in Europe remains a wildcard, traders should approach the upside with caution. The late month run-up was likely due to short-covering because uncertainty continues to reign. With the upside limited, traders should learn to protect the downside should the European debt crisis continue to fester. The way of least resistance is down which makes the Aussie vulnerable to a hard break.

AUD/USD Forecast Nov. 9th, 2011, Technical Analysis

AUD/USD fell again on the session for Tuesday, but bounced again in order to form a hammer at the end of the day. The pair looks like it is trying to find real support at the 1.03 level, but the 1.05 area is just above and locks formidable. With this in mind, we can’t buy this pair now, as the move could be limited.

Until we get a solid daily close over the 1.05 level, we will not buy this pair and are willing to pass the trade up. A break of the lows on Monday and Tuesday would also signal a move to the downside. With these two triggers in place, we know under which parameters we are willing to be in this market from.

AUD/USD Forecast Nov. 8th, 2011, Technical Analysis

AUD/USD fell on Monday, but managed a bounce again as American traders continue to ignore any signs of global economic issues. The pattern has been the same for a while: Asians and Europeans tend to sell off risk assets such as the Aussie, and Americans continue to buy them. On the daily chart, the candle looks like a hammer trying to form, and this is a supportive sign. However, the 1.05 level is just above, and is certainly resistive. The chart calls for consolidation between 1.02 and 1.05 or so.

AUD/USD Forecast Nov. 7th, 2011, Technical Analysis

AUD/USD had an initially weak session on Friday, but bounced in later hours as the Americans went hunting for values. The pair looks like it is finding support in the form of 1.03, and as such could make another attempt at the 1.05 level. The price action suggests we could see tight and range bound trading between the 1.03 and 1.05 levels in the near-term. Because of this, we are looking for scalping set ups more than anything else, and the trend is up – so we prefer longs near this area for about 50 pips at a time.

AUD/USD Forecast for the Week of Nov. 7th, 2011, Technical Analysis

AUD/USD had poor week over the last 5 sessions, but did manage to find a bit of support in the 1.03 area. The level has been supportive in the past, so this is a good sign. The breaking of the 1.07 on a weekly close is going to be needed for us to take long-term positions in this pair, and a breaking below parity is needed for us to short it for any real length of time. We see consolidation coming for this pair, mainly between the 1.03 and 1.07 levels, so long-term trades will more than likely be hard to come by.

AUD/USD Forecast Nov. 4th, 2011, Technical Analysis

AUD/USD had a strong day on Thursday as traders celebrated the cancelling of the Greek referendum. The risk trade came back, and as always – the Aussie benefits. The 1.05 level above is still a massive resistance area, and as such – we aren’t willing to buy yet. In fact, we think the 1.05 level a great barometer as to which direction we want to trade this pair, but only after the Friday close. The session could be very important for the near-term future of this pair. The G-20 meeting will also produce chances for fireworks as well, and as a result, we feel it is better to wait until Monday to take a trade.

AUD/USD Forecast Nov. 3rd, 2011, Technical Analysis

The AUD/USD pair initially rose during the Wednesday session before falling again in the afternoon. The pair remains under the 1.05 level, and it appears sellers have stepped into the pair once we got close to it. With this in mind, we think the bias is still to the downside, and a breaking of the bottom of this shooting star-shaped candle would have us considering selling. It should be noted however, there is a set up in the GBP/USD that looks very much the same, but with a clearer path to the downside. We won’t buy until the daily chart closes well above the 1.05 level.

AUD/USD Forecast Nov. 2nd, 2011, Technical Analysis

AUD/USD fell hard during the Tuesday session as traders both sold off risk assets and came to grips with the interest rate cut that the RBA did during the session. The Reserve Bank of Australia mentioned that they are in “neutral” mode, and we think that the currency will be very reluctant to move in the affirmative with the risk profile out there. The headline risks out there will continue to plague the currency, and as long as the global economy is so shaky, we continue to think selling the rallies as long as we are under the 1.05 level. Buying won’t come into play until we can break the recent highs around the 1.0750 level.