Looking Forward to sell rallies in AUDUSD (extract from Weekly Market Forecast 19th of January 2014)

The AUDUSD pair dived down in the last week after the disappointing employment data. The pair broke an important support level at around the 0.8900 figure, as can be seen in the daily chart shown below. I think if this break is true, then the pair may move lower from here. So, until some of the key resistances holds, we would be looking for short term sell opportunities.

The pair might retrace some of the losses from here with a small move up, as shown in the 4 hour chart below. If the pair makes a small move higher and forms a bearish divergence on the 4 hour chart, then we can enter into a sell trade.

Alternatively, the pair may consolidate for some time, and form a pattern like a triangle, wedge, channel and flag, as shown below. Once the pair forms a pattern, moves lower, breaks the pattern and close below it, then we will jump into a sell trade.

Initial target should be around the 0.8650 level, and final target could be around the 0.8550 level. Stop should be placed above the broken trend line as resistance at around the 0.8940/60 level.

Major events scheduled in the upcoming week
This past week was a dollar positive week, as the economic data came better than expected. The US retail sales, PPI data, jobless claims data and inflation data were in line or better than expected, which helped the US dollar to gain some ground against most of the major currencies, except the pound as the UK’s retail sales data jumped higher in last month, which helped the GBPUSD. During the upcoming week, we do not have any major market moving event for the US, except the existing home sales data. Furthermore, we have some key events for the UK and Euro zone scheduled. The Canadian inflation data is also lined up in the next week.

Let us look at all major events lined up in the upcoming week.
Sunday – Chinese GDP and industrial production data.

Monday – German PPI and New Zealand CPI data.

Tuesday – German ZEW economic sentiment, Canadian sales data and Australia’s inflation data.

Wednesday – UK employment data, BOC interest rate decision and Chinese HSBC Manufacturing PMI.

Thursday – French Manufacturing PMI, German Manufacturing PMI, Euro zone Manufacturing PMI, Euro zone Service PMI, Canadian retail sales data and US existing home sales data.

Friday – Canadian inflation data.

This analysis is taken from Weekly Market Forecast, which also includes trade opportunities on: EURUSD, GBPUSD, EURGBP, USDJPY, EURJPY, USDCAD, EURCAD, NZDUSD, EURAUD, AUDNZD, GOLD, INDICES and DOLLAR INDEX.
Get it HERE: Vladimir’s Markets Forecast

Enjoy friends!

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