The Australian dollar rallied a bit during the trading session on Friday, reaching towards the 0.71 handle. That’s an area that has caused a bit of resistance, and of course we have the 50 day EMA just above. However, I think there is more than enough reason to believe that we will eventually break above there, based upon the historical action in this market. Beyond that, I see a massive amount of support at the 0.70 level, as it extends down to the 0.68 handle on the monthly charts. With that in mind, I think that we are testing the bottom of the Aussie dollar overall and therefore I have no interest in shorting in this region. I think that pullbacks continue to offer plenty of value, and I think that eventually we will turn around if we can get some type of good news out of the US/China trade situation.
AUD/USD Video 18.03.19
It’s not until we break down below the vital 0.68 handle that I would be a seller of the Aussie dollar, something that I do not see happening anytime soon. In fact, I think we are trying to form a floor for a trend change, and that of course takes quite a bit of time to happen. It’s normally a very messy affair and can be quite erratic at times. With that being the case, I recognize that this isn’t necessarily going to be the easiest market in the world to hang onto, but I certainly think that is what we should be doing.
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