(Click on image to enlarge) It’s worth noting that the candlestick is a bit of a hammer, but if we were to break down below the bottom of the candlestick for the trading session on Friday, then it would turn into a “hanging man.” The hanging man is considered to be a major negative sign, and therefore could see a lot of sellers jumping into the market. In this environment, the market goes looking to the 50 Day EMA, which of course is an indicator that a lot of people pay attention to. That is currently just about at the 0.67 level, so I think it all comes together as an important level. If We Break Outif we were to break out, I think it would not only be a positive sign for the Australian dollar, but it probably would coincide with a lot of selling pressure in the US dollar overall. The US dollar of course is going to move in the same general direction everywhere, due to the fact that this is a measurement of risk appetite at the moment. After all, the Federal Reserve has cut interest rates by 50 basis points this week, so while we are seeing the US dollar softened overall, the reality is that the could see things turn around if all of the sudden we get a lot of “risk off behavior”, as traders could run into the treasury markets. Ultimately, I think we are at a major point of inflection.More By This Author:Pairs In Focus – Sunday, Sept. 22Crude Oil Forecast: Continues to RecoverUSD/CAD Forecast: US Dollar Tests 200 Day EMA Against Canadian Dollar
AUD/USD Forecast: Australian Dollar Continues To Face Resistance
