AUDUSD forex technical analysis

Things are looking a bit sucky everywhere and Australia has got its fair share of suckiness right now

The GDP numbers just confirmed what everyone knew already and the calls forecasts for the currency are all doom and gloom. That's life though and when things are looking bad people get extreme in their calls

Our readers area bit smarter than that and don't often jump in with the bandwagon. The Aussie may fall but you guys will let the prices do the talking not some economist...won't you??

So we've hit a new low and since mid-2014 we can't seem to grab any sort of decent bounce. The only one we had was around Apr/May this year at just over 500 pips. We're well through the RBA preferred level and now the genie is out the bottle they might start getting worried they can't get it back in

The aussie has started the month with an ominous sign

AUDUSD monthly chart

We've opened September below the 2001 support line around 0.7150 and that's the first basis for resistance. We have minor weekly support from Apr/May 2009 around 0.6988 and 0.6951, the first of which has already been tested. Unless we get back above 0.7150 we're more likely to see the downside come into greater focus. If we test it and hold then that will be the time to get in or add to shorts

Under the 0.69's, 0.6855/60 is the next target and then we have a big gap down to the March 2009 lows at 0.6285, then Feb at 0.6250. Get there and we can start talking about 0.60

Often I talk about bias when trading and the bias for AUD is still down. The aussie faces a weakening economy, China, the RBA easing and the Fed raising. It's all stacked up to stay on the sell side. I was last in shorts from 0.75 and was looking for another run to there to get back in again. As that boat might have sailed I'm going to monitor the 0.7150 level now and see how that does with a view to getting short again

The risk for shorts is the clock ticking down on the Fed part of the trade. That's not a part to be taken lightly as when they hike it will largely remove or lessen that weight from the bearish side of the scale. If we do see a hike this year then that could mean a last blow out for AUD before a period of stability and maybe a "thank **** that's out the way" rally, then we'll get back to Australian fundamentals