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AUDUSD Drops Within Upward Channel – Forex Economic Update


Sep.11.2016

AUDUSD Drops Within Upward Channel

On lower than expected Australian and Chinese data AUDUSD Drops Within Upward Channel on Friday. What is next for the pair as we start the trading week? Read on for a 360 Invest Diva Diamond Analysis.

AUDUSD Drops Within Upward Channel - Kiana Danial Invest Diva Report AUDUSD Drops Within Upward Channel - Kiana Danial Invest Diva Report

 

AUDUSD Drops Within Upward Channel - Technical Analysis

The US dollar faced massive volatility on Friday and the AUD/USD pair dropped sharply on way lower than expected Australian Home loans and Chinese CPI which came in red as well.

AUDUSD Drops Within Upward Channel - Technical Analysis AUDUSD Drops Within Upward Channel - Technical Analysis

As AUDUSD drops within upward channel, it is still supported by and upward moving Ichimoku cloud. The main pivot level falls in the middle of the Ichimoku cloud at 23% Fibonacci level at 0.7450. Upper resistance level is set at 38% Fibonacci at 0.78.

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This means that even a break below a channel wouldn't be strong enough to change our long-term outlook to bearish, and even may be a good time to go bullish on AUD/USD at the lower pivot.

Trading Strategy

Bullish Scenario

Look for a bullish reversal signal at the lower pivot or if the pair fails to break the Ichimoku cloud. Target 0.78 and 0.8150 in extension depending on your risk tolerance.

The long term bullish resistance level is set at 0.8450.

Bearish Scenario

A break below the Ichimoku cloud could change our outlook to bearish. Targets are set at 0.7250 and 0.6950.

Economic Calendar

Monday

We are certainly expecting a more quiet day today as we don’t have major marketing moving evens on the calendar. During the New York session we are expecting the 3 and 6 month bill Auctions 3:30 PM GMT. Investors monitor the yield volatility and compare the average rate at auction to the rate at previous auctions of the same security as an indicator of the government debt situation., which could ultimately impact the USD strength. 

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During the following day’s Sydney session RBA Assistant Governor Kent is scheduled to speak at 10:30 PM GMT and since  he is responsible for the RBA's Economic Analysis and Economic Research Departments, this could give investors more insights about the future of Aussie dollar.

 

Here are Invest Diva's calculations for important AUD/USD approximate levels to keep an eye on:

Support Levels Turning Point Resistance Levels
0.6950 0.7450 0.8150
0.7250 0.78 0.8450

 

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Kiana 喜愛成
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