Well, From the Previous Market outlook, everything seems to go as predicted in that outlook.
No Major News Coming out on the 8th of January 2008.
Market went Out “GUNS BLAZING” yesterday after the interest rates statements from ECB and BOE, US Data came out lower but still better than previous month’s drop. All This Weighing down on Cable and EUR/USD.
The Previous Charts i posted is still Valid for Friday, so a move to the downside for Both Cable and Euro is still probable. I’m Leaving that aside for now, and I’m Going to have a look at AUD/USD today.
To Be honest I’m Still Bias to the Upside for AUD/USD, I mean The Australian Economy is Doing Fantastic, Inflation is underway right now ( Actually Inflation is not a good thing ), which means that The RBA would probably Do A Rate Hike Again, possibly as soon as Next Month or before Q2 ends.
Growth Might have been slowed due to the Recent market turmoil, but I’m still Hoping for a parity in AUD/USD. Metals are in hot demands now, and Guess where most Metals come from? Australia of Course!!
I Do not see a reason why AUD cannot Reach Parity, so for now that will always be my Target. The only reason for AUD/USD not able to reach parity is if there is a Major Carry Trade Unwinding ( i.e. Risk Aversions) that could affect AUD/JPY, but then again it would only be temporary.
Let’s Look a the AUD/USD Daily Chart
A Bullish Divergence has formed on the Daily Chart, Price makes a lower low and Stochastic makes higher low.
Although Daily Stochastic has just crossed down, indicating a probable move down these next few days. Prices are Also Above the 200 MA, indicating that the pair itself is still in an uptrend albeit a slower one.
So I would be waiting for a Bullish Hidden Divergence to form this time and see whether or not 200 MA will be able to support the pair. I’m not recommending Going against the trend, so i would wait for further confirmations on the AUD/USD.
0.9124 -- R1 Weekly Pivot
0.9225 -- R2 Weekly Pivot
0.9405 — 7th Nov High
1.0000 -- Psychological Level
0.8945 -- S1 Weekly Pivot
0.8844 -- S2 Weekly Pivot
0.8564 -- S3 Weekly Pivot
0.8507 — 22nd Jan Low
Remember that this is a Daily Chart so it would only serve as a general Guidance to overall market movements for the days ahead. What happens inside a trading day is a totally different story.
I would Also like to ask You Readers and Fellow Traders to give me some feedback, on whether or not i should be doing it with a daily Chart or maybe something smaller.
The reason why i went with Daily Chart is, you might be reading it at different times.
If i used a shorter time frame to do my analysis, which would be more accurate for trading, You might be reading it a different time and then it’s not useful anymore.
Been A Great week and Good Luck in you trades ahead.