AUDUSD Weekly Forex Forecast – 17th to 21st Oct 2016
The AUDUSD is in the process of developing a major rounded swing high. The price action is showing the market making lower highs accompanied by lower lows. Overall, we’re still in a big consolidation zone, but a break below the 0.7500 big psychological number will reinforce the bearish case. Last week rally looks corrective in shape and the stochastic indicator is already in overbought territory and we have a 4h crossover that is indicative of a turnaround.
The technical pattern has complicated because we have spent the last 3.5 months in a 450 pips consolidation area and until we break on either side of the range it’s hard to anticipate the next big swing. However, judging that we’re still in a monthly bearish trend we can presume that the next move will be to the downside in line with the bigger macro trend.
Tuesday, traders need to pay attention to the RBA minutes, which will give more details into the latest RBA monetary policy decision. The RBA left the interest rates unchanged at historical low level of 1.5% after cutting rates two times in 2016. The Australian economy is growing at a slower pace and the concerns over the housing market should be the highlight of the minutes which can be the catalyst for some bearish AUDUSD momentum.
AUDUSD Weekly Forex Forecast – 17th to 21st Oct 2016 – BEARISH
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