The Australian dollar was seen trading lower during this week, as the Reserve Bank of Australia was seen concerned about the interest rates. However, I think the AUDUSD pair might rise from the current or a bit lower levels. So, buying dips is not a bad idea in the short term considering the bullish divergence formed on the 4 hour chart.
There is an up-move trend line waiting to hold the downside in the pair. There are several supports around the 0.9320 area. The 200 moving average on the 4 hour chart also sits around the same area. So, there are a lot of reasons to consider a buy position. We can enter a buy position around the mentioned support area. Remember, the trend line support should hold for this trade setup to be valid.
Initial target should be around the 0.9380 level, and final target could be around the 0.0.9410 level. Stop should be placed below the 0.9280 level.
Reviewing yesterday’s events and trades
Yesterday, it was an interesting day, as a lot of economic releases were scheduled during the London and the NY session. The first in the line was the UK inflation data, which fell to 1.5%. Next, the German ZEW economic sentiment was published, which registered a decline. Furthermore, during the NY session, the US inflation data was published, which came better than expected with a rise to 2.1%. Overall, the US dollar was seen trading higher post all these events.
Fundamental Outlook for the day
Today is an important day as the Fed interest rate decision is lined up followed by the Fed’s chairwoman Janet Yellen’s speech. These events can turn out to be a game changer for the US dollar. If Yellen hints anything about a possible rate hike, then we might witness a sharp rise in the US dollar. Alternatively, if she says nothing new, then the US dollar could take a hit in the coming sessions against the currencies such as the Euro and the Japanese yen.
This analysis is taken from today’s Daily Market Forecast, which also includes trade opportunities on: EURGBP, NZDUSD, EURNZD, EURJPY, OIL and SILVER.
Get it HERE: Vladimir’s Markets Forecast
Trade safe friends. Happy trading!
