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Christopher Lewis

The Australian dollar has gone back and forth during the trading session on Thursday, initially trying to rally before giving back the gains. We are currently trading in a relatively well defined range that features the 0.68 level on the bottom, with the 0.70 level above as resistance. The 0.70 level of course is a major round figure that will attract a lot of attention, but I think that when you look at the longer-term charts, it becomes a bit obvious that there is an area between 0.70 and 0.71 that offers significant resistance. What I find particularly compelling about this area is that if we break above the 0.71 handle, it is likely that we will have a longer-term trend change.

AUD/USD Video 26.06.20

While that is something that I am definitely keeping an eye on, the reality is that would be difficult to accomplish, and I think at this point the pair would have a lot of work to do to make that happen. Even if you are bullish all the Australian dollar, a pullback should be a welcome sign, because I think there is plenty of support not only the 0.68 level, but also at the 0.6675 handle. Both of those will more than likely offer opportunities for traders to enter to the long side. However, if both of those areas get broken to the downside, that could spell even further losses for the Aussie. Quite frankly, with infection rates picking up around the world it would make sense for the Australian dollar to take it on the chin a bit.

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

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