By FX Empire.com

AUD/USD rose during the previous week after first facing an initial selloff. The pair formed a hammer for the week and looks like it could be set to rise, but as the highs continue to get lower, it is hard to be as bullish of this pair under normal circumstances. The Dollar is well bid currently, and because of this, we are somewhat weary of going against it.

The 1.05 level above looks very resistive, as does the 1.03 area. One of these should keep the pair down at the level. The pair is looking like a choppy market between here and 1.05, and that keeps us away, although it looks like up is the next move. Having said that, we think consolidation is going to be the order of the day between 1.05 and parity for the next several weeks as the world tries to figure out what is coming from Europe and China.

AUD/USD Forecast for the Week of January 2, 2012, Technical Analysis

AUD/USD Forecast for the Week of January 2, 2012, Technical Analysis

Originally posted here