AUD/USD: Consolidating in Down-Trend
The aussie started to resume its down-trend after a fairly substantial rebound. It has fallen down to the 0.9430s but has stalled at that level and even started to recover little. Currently a sideways consolidation is happening on the hourly chart and possibly may even be forming at a higher level, however, the FOMC meeting later today is likely to supply some widely expected volatility which could push prices out of their current zones. A decisive break above 0.9570-75 would signal a probable breakout higher, with a target at 0.9700; a break below 0.9400 however, might indicate a move lower to the monthly pivot at 0.9275 and given the overall trend is still down is the more likely.
The EUR/USD pair broke out from the pennant and rallied a bit but has now fallen back down to the upper border line of the pattern where it is currently resting on support. It will probably bounce from this support level and continue higher fulfilling its strong up-side potential. An initial target would be the monthly pivot at 1.3457, which may be difficult to breach, however it will probably rise further with 1.3670 providing the next target. Markets are subdued ahead of the FOMC meeting today when there is likely to be much volatility. As far as downside goes – a break below 1.3277 would lead to a move down to 1.3160.
The GBP/USD pair seems to be trading in what is probably a broadening formation. Currently it is trading at the 1.5570 lows of the pattern after a strong move down. It has started to bounce up and the most probable scenario is that we will now see a move back up to 1.5725 range highs. Alternatively, decisive break below 1.5525 would lead to a break-down out of the pattern and probably fall till support from the 50-day MA at 1.5400.
Analysis By: Joaquin Monfort, Forex4you Analyst
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