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AUD/USD Drops Within Upward Channel: Forex Economic Update

On lower than expected Australian and Chinese data AUDUSD Drops Within Upward Channel on Friday. What is next for the pair as we start the trading week? Read on for a 360 Invest Diva Diamond Analysis.

AUDUSD Drops Within Upward Channel - Technical Analysis

The US dollar faced massive volatility on Friday and the AUD/USD pair dropped sharply on way lower than expected Australian Home loans and Chinese CPI which came in red as well.

As AUDUSD drops within upward channel, it is still supported by and upward moving Ichimoku cloud. The main pivot level falls in the middle of the Ichimoku cloud at 23% Fibonacci level at 0.7450. Upper resistance level is set at 38% Fibonacci at 0.78.

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This means that even a break below a channel wouldn't be strong enough to change our long-term outlook to bearish, and even may be a good time to go bullish on AUD/USD at the lower pivot.

Trading Strategy

Bullish Scenario

Look for a bullish reversal signal at the lower pivot or if the pair fails to break the Ichimoku cloud. Target 0.78 and 0.8150 in extension depending on your risk tolerance.

The long term bullish resistance level is set at 0.8450.

Bearish Scenario

A break below the Ichimoku cloud could change our outlook to bearish. Targets are set at 0.7250 and 0.6950.

Economic Calendar

Monday

We are certainly expecting a more quiet day today as we don’t have major marketing moving evens on the calendar. During the New York session we are expecting the 3 and 6 month bill Auctions 3:30 PM GMT. Investors monitor the yield volatility and compare the average rate at auction to the rate at previous auctions of the same security as an indicator of the government debt situation., which could ultimately impact the USD strength.

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During the following day’s Sydney session RBA Assistant Governor Kent is scheduled to speak at 10:30 PM GMT and since he is responsible for the RBA's Economic Analysis and Economic Research Departments, this could give investors more insights about the future of Aussie dollar.

Here are Invest Diva's calculations for important AUD/USD approximate levels to keep an eye on:

Support Levels Turning Point Resistance Levels
0.6950 0.7450 0.8150
0.7250 0.78 0.8450

This article was originally published on InvestDiva.com.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Kiana Danial

Kiana Danial is an award-winning, internationally recognized personal investing and wealth management expert. She is a highly sought-after professional speaker, author and executive coach who delivers inspirational workshops and seminars to corporations, universities and entrepreneurial groups. She is a frequent expert on many TV and radio stations and has reported on the financial markets directly from the floor of NYSE and Nasdaq. She is a weekly investment expert guest on Tokyo’s #1 Investment TV Show. She has been featured in The Wall Street Journal, TIME Magazine, CNN, Forbes, The Street, and numerous other publications. Kiana’s book "Invest Diva's Guide to Making Money in Forex" was picked by McGraw-Hill only two years after she first moved to the US, and was an immediate domestic and international success. At a young age, she has won numerous awards including Best Financial Education Provider at Shanghai Forex Expo in 2014, New York Business Women of Influence Honoree in 2015, and Pro Bono Humanitarian Award by IA Bar Association in 2013. Born and raised in Iran to a Jewish family as a religious minority, she was awarded a scholarship from the Japanese government to study Electrical Engineering in Japan, where she obtained two degrees in Electrical Engineering and researched on Quantum Physics in classes conducted in the Japanese language. Being the only girl and foreigner in her classes made her decide to dedicate her life to empowering minorities, especially women in male dominated industries. As the CEO of Invest Diva, Kiana’s goal is to empower and educate women to grow their wealth by investing like a ROCK STAR.

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