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STOCKS SLIP WITH MIDEAST TENSIONS, EARNINGS IN PLAY

Oil pares losses as traders anticipate Israel's response to Iranian attack

AUD/USD Price forecast for the week of November 20, 2017, Technical Analysis

Christopher Lewis
Updated

The Australian dollar initially tried to rally during the week but then fell rather significantly, reaching towards the 0.7550 level. There is an uptrend line underneath, sitting just above the 0.75 handle, and I think that is where buyers may return. However, the gold markets are showing signs of explosive growth, and until we get that I would be a bit hesitant to go long of the Aussie dollar as it is so highly correlated. The stochastic oscillator ease in the oversold condition, but we have not crossed over quite yet. If we get the crossover under the 20 level, along with the rising gold, it’s likely that buyers will jump into this market and try to rally towards the highs again, with major resistance being found at the 0.7750 level above, as it has been important in the past.

Alternately, if we break down below the 0.75 handle, the market will probably come undone, reaching first towards the 0.7350 level, and then eventually the 0.6850 level after that. The US dollar is strengthening against the Australian dollar overall, but I think we have gotten to the point where things have been a bit overdone, so a bounce would not be a huge surprise. The bearish candle for the week suggests that although impulsive, we may be overextended. Either way, longer-term traders should probably wait for a weekly candle close to make a trading decision, as this is an area that is going to be very important, and depending on the reaction we get to it, we could see a major move over the next couple of months. When you are talking about the next 500 pips, you can afford to be patient and wait for the right set up.

AUD/USD Video 20.11.17

This article was originally posted on FX Empire

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