📈 The Australian Dollar is on the Move -TCI Analysis

Recently, the Australian Dollar has shown strong movement against other major currencies. Using MT4 technical analysis and the Trading Center Indicator (TCI), we will examine whether this trend is likely to continue or if we are nearing its completion, indicating a possible reversal. But first, let's review our previous Forex analysis on EURUSD.

Evaluation of the Previous Forex Signal on EURUSD

On October 11th, we published an analysis of EURUSD. At that time, there was no clear trend, but we noted that the most probable scenario was a new regional high forming: “the most probable scenario is that EURUSD will try once more to form a new high (+8 trading days), and after that, a trend reversal (↓) is very probable to occur.”

In that article, we also identified two key EURUSD levels:

■ Bullish Trigger: 1.358

■ Bearish Trigger: 1.345

■ EURUSD at that time: 1.3541

The EURUSD bullish trigger level of 1.358 was reached, followed by a strong uptrend to 1.3703. Looking at the TCI indication table in that same article, we can see that TCI forecasted a regional high of +8 trading days. That places the high 8 trading days after October 11th—namely, Wednesday, October 23rd. That date is approaching, and we will soon be able to assess the accuracy of the TCI projection made on October 11th.

Read more: The Australian Dollar is on the Move 2013

In this analysis, we examine the future direction of EURUSD by presenting and analyzing TCI technical results for the coming weeks. Additionally, all key upcoming news events are listed in individual tables for EUR, USD, GBP, JPY, CAD, CHF, AUD, and NZD. Overall, it appears that EURUSD has entered an overbought zone, but the timing of a potential downtrend reversal remains uncertain. Before continuing, here is a brief recap of our previous report on EURUSD, GBPUSD, and USDJPY, along with some key details.

📄 The Previous TradingCenter's Report

In our previous report, we stated that the US Dollar was expected to strengthen in the long term. However, we also noted that major USD pairs (EUR, GBP, and JPY) were likely to experience corrections, as they had already reached oversold levels. These corrections were anticipated to occur after a few weeks, but they took place much sooner, triggered by a speech from the FED chairman. At that time, EURUSD had already reached the strong support level of 1.2750, as shown in the following chart. Our long-term forecast remains unchanged—we continue to expect the US Dollar to strengthen, particularly against the Euro.

📶 EURUSD -What Should We Expect Next

The most likely scenario is that, following a short-term downtrend correction over a few days, EURUSD will attempt to reach a new high. Whether it succeeds in forming a new high or not, EURUSD may still appear overbought. However, this is simply the natural progression of technical analysis. Significant news related to the Euro and the US Dollar could alter this technical outlook. All key upcoming news affecting EURUSD is listed at the end of this report. Below is an MT4 chart for EURUSD, including the RSI and 50-day Moving Average.

Read more: EURUSD July 2013

This EUR/USD technical analysis report is based on a 4-hour and 1-day MT4 chart, combined with the Trading Center Indicator (TCI) results.

📈 EURUSD Price Action and Short-Term Trend

Conclusions from the EUR/USD Price Action Analysis:

The 4-hour (H4) EUR/USD chart shows a downtrend, but the daily (D1) chart does not confirm this, indicating no clear short-term trend. If EUR/USD rises above 1.358, the short-term trend could turn bullish temporarily. Conversely, if EUR/USD falls decisively below 1.345, the trend would likely be strongly bearish.

■ Currently: 1.3541

■ Short-Term Bullish Trigger: 1.358

■ Strong Bearish Trigger: 1.345

Chart: EURUSD February 2013-October 2013

Read more: TCI on EURUSD October 2013

It seems the time has come for the British Sterling. Recently, the British Sterling (GBP) has started an uptrend against all majors and minors. The current TCI trading signal involves GBP against the Australian Dollar. The Australian Dollar (AUD) is very weak against all majors during this period, especially versus GBP, EUR, and USD. But before presenting more data on GBPAUD, we should, as always, evaluate our previous signal. The previous signal concerned EURUSD and other popular pairs (23rd of May 2013).

📶 Evaluating the Previous TCI Forex Trading Signals

In our previous analysis, we mainly focused on EURUSD, indicating an upcoming uptrend. At that time, EURUSD traded at 1.2850. Today, after two weeks, EURUSD is at 1.3217, delivering an impressive return for derivative traders. Regarding the other signals, we correctly forecasted the movements of USDJPY and USDCHF but incorrectly predicted the trends for GBPUSD and EURNZD.

📈 British Pound Sterling against the Australian Dollar

The Australian Dollar (AUD) is currently very weak against all majors, a trend expected to continue over the next few weeks, assuming neutral news. In this Forex trading signal, we focus on the British Pound Sterling (GBP) against the Australian Dollar (AUD). The reason is that the British Pound is close to its historical lows against the Australian Dollar, indicating strong support below. The trading signal points to the following target profit and stop loss levels:

◘ GBPAUD Currently: 1.6374(*)

◘ GBPAUD Mid-Term Trigger: when 1.6480 breaks for sure

◘ GBPAUD Target Profit: 1.6900 (mid-term)

◘ GBPAUD Stop-Loss: 1.6320, 1.6280 (short-term) and finally 1.6180 (mid-term)

Read more: GBPAUD June 2013