The pivot points are important support and resistance levels. It serves to identify whether the price of the pair declines. Thus, the pivot points may quite successfully serve as input and output indicators. The way the pivot points are operated and the strategy is used depend on the type of an investor.
1.0314 and 1.0389 are weekly and monthly pivot points for this week for AUD/USD.
The Australian dollar is above the weekly pivot and bellow the Moving Average of 200 periods (blue). Therefore, the pivot points show the following.
The fact that the pair is above the weekly pivot increases the likelihood that there is an upward movement until the second weekly resistance of 1.0523.
Moreover, the downward pressure will continue to increase below the weekly pivot, the nearest target is 1.0217. (W_S1) We recommend buying at this level.

Signals for October 22 - 27, 2012

Buy long if it closes above weekly pivot at 1.0314 with take profit at 1.0426 and 1.0523, stop loss is bellow (W_S1).

Buy if it rebounds around 1.0217 with take profit at 1.0314 and 1.0426, stop loss is bellow (W_S1).

_____WEEKLY_____
Weekly - R3 = 1.0635
Weekly - R2 = 1.0523
Weekly - R1 = 1.0426
Weekly Pivot = 1.0314
Weekly - S1 = 1.0217
Weekly - S2 = 1.0105
Weekly - S3 = 1.0008

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_____MONTHLY____
Monthly - R3 = 1.1071
Monthly - R2 = 1.0847
Monthly - R1 = 1.0613
Monthly Pivot = 1.0389
Monthly - S1 = 1.0155
Monthly - S2 = 0.9931
Monthly - S3 = 0.9697