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Also, the purpose of this trading lesson is education. This does not constitute trading advice. Nor do I give out trading signals. All opinions are my own and not blogger.com nor Google.com.
Last week, I talked about the AUD/USD and how it would continue to go down to 0.9178. Sure enough it did go down even further to 0.9143 for a new low.Just looking the Weekly chart that the stochiastics showing that we can go lower. The fresh prospect of taper have come back into the headlines. There was good reason to suspect that it will happen. Here is Daily Chart for AUD/USD.
You can see that stochastic is still point down and could go into the oversold level. But, caution is still need not to buy at this time If it goes like it did in July or August, buyers could come in buy the Aussie. When will this pair see the levels like last year or at 1.10 level is anyone's guest. The Fed left the option of taper open and was dependent of the data coming out of the US. The S & P is overbought and believe there is much need correction,so it can find fair value. The levels are to bubbly and looks like a bubble. Also, there is not much in terms of events on the calendar that really market moving with the exception of Consumer Confidence and GPD figure set to be released. Consumer confidence report is released on Tuesday and GDP figure comes out on Wednesday. This should give the FED much of the evidence along with NFP coming out next month. It will tell the FED on how soon the taper will begin. Also, We could retest those low of 0.8840 and time will tell.On to the Kiwi, last week I stated that I believe the Kiwi was heading lower because a head and shoulders pattern on the daily chart. The theme did play itself out and hit my target of 0.8145. The Kiwi did hit the low of 0.8126. This confirmed my overall biased. There is a possibility of retesting those lows like we did back in June of this year. The low was 0.7697.
I believe in the future if you do find the lowest and test it at support. If it holds, it will return to test the highs. The prospect of higher interest rates coming out New Zealand and Australia could wash out the effects of the taper. It could see some choppy price action because of both events.
On to the CAD, last week the pair rose on the data coming out the US and prospect of the taper and data that will come out of the USD. This pair is still quite bullish for the short and medium term. on the daily and weekly charts. I do expect the pair will retest the highs of 1.0838 that happen in September 2011 on the weekly chart. A lot will depend on the data coming out of the US. Here is a look at the USD/CAD.
As we can see it is bullish,I believe it can go higher. But a retest at 1.0270 would re-confirm the bullish bias on this pair. I would look to the data and will depend on the reports coming out. Let's wait and see because with these markets anything can happen. There is no guarantees what will happen over all. Just trade well and trade on slower time frames for the best results possible. Well, this is it for this week. Remember that US markets are closed on Thursday due to Thanksgiving holiday. Take care and good luck trading this week. I will put out another report next Sunday. We see what happens in the markets this week.
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