Weekly Forex Forecast- GOLD, EURAUD – 16th October 2022

Hi Traders! Weekly Forex Forecast 16th October 2022 is here. In this post, I analyze and forecast GOLD and EURAUD. GOLD has been moving in a clean downtrend for a long time, and its price action is moving in a very clean daily bearish channel. As long as the price structure remains inside the channel, I would look to sell the GOLD. EURAUD price action suggests a clear bullish trend, and the price is moving in clear higher highs higher lows structure. I believe the momentum should continue until the pair reaches key resistance levels and supply zones on Daily and Weekly time frames.

You can watch the video explanation of this forecast here:

 

 

Gold

D1 – On the daily chart, the price is moving inside a bearish channel creating lower highs, lower lows structure. Despite the fact that the price has created a bullish divergence between the most recent lows, the trend never changed. The price didn’t manage to go above the previous significant highs or build a bullish structure.

 

 

 

So, after the bullish divergence the price moved higher, respected the top of the bearish channel and bounced back lower, this makes me think that the very possible scenario is that the bottom is not yet completed. The price might go lower and create one more low which could be the last of this cycle and from there it might bounce and change the trend.

 

 

In order to look for the possible levels here, I plot the Fibonacci expansion and you can see that the 261.8% Fibonacci expansion level of the special cycle is right next to the weekly volume zone. The bottom line here is that, I believe Gold yet has more to offer to the downside.

 

 

H4 – On the H4 chart, I see clear trending price behavior right now with the price creating three lower highs, lower lows. So in my point of view sell the rallies is my plan here.

 

 

It is important to remember that sometimes the movement after the trending structure could be in some sort of a range. So the price might create an impressive rally and then it might bounce back and deliver a new low.

 

 

 

EURAUD

W1 – On the weekly chart, we have an impressive rally and I don’t think this rally is over yet. The reason I think so is because after a very impressive move to the downside, the price completed this movement with a fake low and a bullish divergence on the moving averages and the histogram of the MACD indicator. The price then moved higher and broke above the last high. Generally, in such cases we may expect pullbacks and further continuation higher.

 

 

We can see that the most recent bearish trend line, swing highs and the massive weekly volume zones coincides on the same area. So I believe the price should go close to this area, finalize the rally and from there very likely we are going to see some bounce to the downside before the price potentially moves higher further.

 

 

D1 – The key zones to watch out for are the ones shown in the image below. Any pullbacks on the lower timeframes might take us close to these zones.

 

 

What I would start paying attention to here is, when the RSI gets to the very over bought conditions, next to the 80 level. We should also see some slow downs developing on the MACD indicator with the price creating some fake highs, that is how we know that the momentum is losing. This is where the bigger correction is very likely to happen where from I would anticipate further rallies.

 

 

 

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