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Christopher Lewis
AUD/USD

The Australian dollar initially tried to rally during the trading session on Thursday but has seen a certain amount of selling pressure later in the day and what would have been thin trading. The Australian dollar is currently sitting just above the 0.7350 level, which has been resistance. However, there is still a lot of noise just above at the 0.74 handle. At this point, the market is likely to continue to go back and forth but eventually we will find buyers underneath based upon the resilient trading behavior.

AUD/USD Video 27.11.20

The 50 day EMA is racing towards the 0.7250 level, which is an area that has been short-term support. As long as the Federal Reserve is out there and willing to flood the markets with liquidity and that does of course work against the value of the US dollar. However, if we are to see a sudden “risk off move”, that could be a bit of trouble for the Australian dollar in general. That being said, the Reserve Bank of Australia is essentially done trying to expand monetary policy, so I think ultimately this could continue to go higher.

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Underneath, the 0.70 level is massive support and I think it is the bottom of the overall range. The 200 day EMA sits there as well, and ultimately, I think that the market is going to go to the upside. All things being equal, I think that eventually value hunters continue to get involved in this market, but we are at a major inflection point when it comes to the weekly and monthly charts which of course causes major issues.

For a look at all of today’s economic events, check out our economic calendar.

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