Talking Points
- Important timing relationship coming up in the Aussie
- Support between .8955/80 looks critical
Unfamiliar with Gann Square Root Relationships? Learn more about them HERE.
The latter part of next week and the start of the week of September 22nd looks potentially important for AUD/USD from a timing perspective as a cyclical relationship related to the 2011 high in the exchange rate could influence around this time. With the pair breaking down from a clear multi-month head & shoulders pattern this week not much looks positive for the Aussie at the moment. However, this could all change late next week if the timing relationship plays out. The key price zone to monitor heading into this turn window is the .8955/80 area as it marks a convergence of the 61.8% retracement of the year-to-date range, the 161.8% projection of the July/August decline as well as several Gann levels related to the year’s low. A successful hold of this zone could set up a decent counter-trend move higher. An easy breach of this zone, on the other hand, would point to a deeper initial decline towards the H&S objective near .8850.
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AUD/USD Daily Chart: September 12, 2014
Charts Created using Marketscope – Prepared by Kristian Kerr
Key Event Risk in the Week Ahead:
LEVELS TO WATCH
Resistance: .9080 (Fibonacci), .9115 (Gann)
Support: .9020 (Gann), .8980 (Fibonacci)
Strategy: Buy AUD/USD late next week
Entry: Buy AUD/USD at .8980 (if touched after Wednesday)
Stop: 1-day close below .8920
Target: .9115
--- Written by Kristian Kerr, Senior Currency Strategist for DailyFX.com
To contact Kristian, e-mail instructor@dailyfx.com. Follow me on Twitter at@KKerrFX.
