AUD/USD – Weekly outlook 17 Oct – 21 Oct
October has so far been a very bullish month for the Aussie. We’ve had only 2 days that failed to close higher than their open and a break back above parity. The market is now nearing towards significant upper resistance areas. The coming day’s price movements could help determine the direction the Aussie takes for the remainder of the month.
1.0400 is the next area to the upside we will be monitoring. The level has held as support in June & August with it turning into resistance in early September. It is possible we see a bounce of this area in the coming week providing us with an opportunity to short this market, possibly back down to parity. Should we see any price action suggesting a rejection of the 1.04 area we will be looking to sell any bounces.
If we see a break and close above the 1.04 area the next significant resistance we will be monitoring is 1.06 and further upside resistance at 1.08.
The weekly chart below shows the market starting to form a downwards channel. Last week saw the price close almost perfectly at the upper resistance of the channel. If we are to see this channel pattern continue we would have to see the market sell off in the coming week back towards the lower line.
