The Australian Dollar (AUD) was able to recover strongly on heavy AUD/JPY buying and a bounce in both Gold and Oil. During the US session sentiment turned again as Oil dropped nearly $4 dollars off highs and gold dropped over $20 an ounce. Comments from the RBA calling for rate cuts to be passed on from the banks was seen by some as an overt declaration of rate cuts in September. Overall the AUD/USD traded with a low of 0.8670 and a high of 0.8798 before closing the US session at 0.8700.

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Gold (XAU) continued to recover during the day before another wave of selling forced Gold back towards the $800 level. Overall trading with a low of USD$805.40 and high of USD$836.50 ending the New York session at USD$810 an ounce. UPDATE GOLD BREAKS $800

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. Euro – 1.4775

Initial support at 1.4719 (76.4% retrace 1.4311 to 1.6038) followed by 1.4700 (Round Number). Initial resistance is now located 1.4815 (Aug 12 low) at followed by 1.4981 (Aug 13 high).

· Yen – 109.90

Initial support is located at 109.04 (Aug 14 low) followed by 108.22 (Aug 6 low). Initial resistance is now at 110.40 (Aug 11 high) followed by 112.15 (Jan 2 high).

· Pound – 1.8660

Initial support at 1.8619 (61.8% retrace 1.7048 to 2.1161) followed by 1.8518 (Oct 11 2006). Initial resistance is now at 1.9036 (Aug 13 high) followed by 1.9123 (Aug 12 high).

· Australian Dollar – 0.8660

Initial support at 0.8593 (Aug 13 low) followed by 0.8513 (Jan 22 low). Initial resistance is now at 0.8797 (Aug 14 High) followed by 0.8846 (Aug 12 high).

· Gold – 794

Initial support at 789.93 (61.8% retrace 640.00 to 1032.5) followed by 773 (Nov 20 reaction low). Initial resistance is now at 803 (Aug 12 low) followed by 836.8 (Aug 14 high).

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At 1.5000/20 it is recommended to evaluate the activity development of both parties according to the charts of shorter time interval.
For short-term sells on condition of formation of topping signals the targets will be 1.4920/40, 1.4860/80, 1.4780/1.4800 and/or further breakout variant up to 1.4720/40, 1.4680/1.4700.
An alternative for buyers will be above 1.5100 with the targets 1.5160/80, 1.5200/20.

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Daily forex market forecasts - EUR, GBP, JPY