AUD/USD Forecast October 16, 2017, Technical Analysis

AUD/USD daily chart, October 16, 2017

The Australian dollar went sideways during the course of the trading session on Friday, but then exploded to the upside as gold rallied after a less than impressive CPI figure coming out of the United States. Ultimately, I believe that the market pulling back should be a nice buying opportunity, as we should continue to see plenty of support underneath. The 0.79 level above will be targeted, and then eventually the 0.0 level after that. The 0.80 level is massively important on longer-term charts, as it is important going back decades. If we can break down below the 0.7750 level, that changes everything, but until that happens, this is a “buy only” market.

I like buying dips, those dips offer value. If we can break above the 0.81 level, the market then extends itself towards the 0.90 level. The market will clearly go looking for that level on a breakout, but it’s going to take a while to get there. I believe that buying dips continues to offer value the traders will be looking to take advantage of. This will be especially true if we have less bullish pressure and hawkish noise coming out of the Federal Reserve. People are starting to think that the Federal Reserve may not be able to raise raises rapidly as once thought, and if that’s the case, the US dollar will continue to struggle while gold rallies. That’s the perfect scenario for the Australian dollar to pick up value as well. Ultimately, I think that it will remain volatile but I do like the Aussie, and the latest moved certainly will do nothing to dissuade me from that attitude. If we were to break down, however unlikely, the move lower could be rather violent as it would take some type of major catalyst to happen.

Written by FX Empire