The Australian dollar tried to rally during the trading session again on Thursday but seemingly cannot get beyond the 0.78 level.
The Australian dollar has initially tried to rally during the trading session on Thursday but continues to struggle at the same area that has been so difficult. The 0.78 level has been like a brick wall for the Australian dollar and with that being the case it is not a huge surprise that we have pulled back a bit in order to form a less than impressive candlestick. All things been equal though, one thing that you have to look at is that the market has been extraordinarily resilient to continue trying to break to the upside. That being said, the market is likely to see more of a “push/pull” situation as the longer-term charts look a little less enthusiastic, but it is clear that shorter-term traders are not ready to give up.
The monthly chart shows an exhaustive shooting star for the month of February and something very similar for the month of March, but at this point in time it is likely that we are going to continue to test that area. The fact that the longer-term traders seem a little bit hesitant while the short-term traders are relentless suggests that this market is going to continue to struggle. When you look at the longer-term monthly chart, you can see that the 0.80 level is a massive barrier that runs about 100 pips to the upside. If we do break above there, this becomes a buy-and-hold type of situation but until then I think we have a lot of volatility in choppiness right around where the market sits currently. In other words, this is going to be very difficult trading for anything other than short-term back-and-forth scalping.
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Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.