AUD/USD Forex Technical Analysis – July 21, 2014 Forecast » Fx …

AUD/USD Forex Technical Analysis – July 21, 2014 Forecast » Fx …

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Once again, buyers came in to support the AUD/USD on weakness, leading to a slightly higher finish for the week. For the second straight week, short-sellers were forced to cover after failing to confirm the potentially bearish closing price reversal top from the week-ending July 4. This may mean the Forex pair is gearing up for another test of this top. The short-term range on the weekly chart is .9504 to .9328, making .9416 the minimum upside target next week.

Weekly AUD/USD

Technically, the retracement zone at .9352 to .9317 is providing the best support. The market has stopped twice inside this zone at .93285 and .9328. If the short-sellers can take out this level with conviction then the next likely downside target is .9197. RBA Governor Stevens would like to see a break into this level, but traders haven’t been very cooperative.

Daily AUD/USD

The daily AUD/USD also reveals stubborn support at .9366 to .9334. The close on the bullish side of the upper or 50% level and a downtrending angle at .9364 indicates strong buying on Friday. It may have been a combination of aggressive longs, profit-taking or short-covering.

Overcoming the uptrending angle at .9399 will be another sign of strength. This could lead to a test of another retracement zone at .9416 to .9437. A downtrending angle from the .9504 top also comes in at .9434. This angle actually creates a resistance cluster with the Fibonacci level at .9437, making .9434 to .9437 the best potential upside target.

With buyers coming in to support the market at .9328 twice this month, traders are likely to try to drive the market back the other way. This means a retracement of the break from .9504 to .9328. This target zone is .9416 to .9437. Bearish traders will try to defend this zone in an effort to form a potentially bearish secondary lower top.

The tone of the market on Monday is likely to be determined by how investors react to the uptrending angle at .9399. Overcoming this angle could create the upside momentum needed for a rally into the main target at .9434 to .9437. A failure at this angle is likely to lead to a retest of the support area at .9366 to .9364. 

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AUD/USD Forex Technical Analysis – July 21, 2014 Forecast » Fx …

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