AUD/USD Price Forecast – Australian Dollar Breaks Through Major Psychological BarrierThe Australian dollar has rallied quite nicely during the trading session on New Year’s Eve, breaking through the psychologically significant 0.70 level. At this point, the market is clearly looking very bullish, and a longer-term trend change is currently going on.
The Australian dollar has broken above the 0.70 level, a large, round, psychologically significant figure. At this point, the market is going to continue to look at this as a breakout, and I believe that the Australian dollar is getting a bit of a boost due to the so-called “Phase 1 deal” that could be coming out of the United States and China. If that’s going to be the case, then I like the idea of the Aussie going much higher as we are at historically cheap levels. We are broken through a major downtrend line, the 200 day EMA, and now are looking at an explosive move.
AUD/USD Video 02.01.20
All things being equal, it looks as if it is a longer-term trend change and I do expect the Australian dollar to be one of the major players for 2020. I have no interest in shorting this market, although I am the first person to recognize and admit that we are a bit overextended in the short term. That short-term overextension should give us a buying opportunity given enough time though once we get that pullback that will be necessary. At this point, the market is very likely to pull back towards the 0.6950 level, before bouncing significantly again and running a bit higher. With this, I like the idea of going long on the first signs of weakness, and I recognize that shorting is all but done at this point. We are about to get the “golden cross” as the 50 day EMA is starting to curl higher and reaching towards the 200 day EMA before that move.
Please let us know what you think in the comments below