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Christopher Lewis
AUD/USD daily chart, September 06, 2019

This is been an extraordinarily bullish run by the Australian dollar, and tensions calm down in Hong Kong may have something to do with that. Even with that, I’m not overly impressed and I do think that it’s only a matter time before market participants will start shorting this pair again. With the jobs number coming out during the day on Friday, that could be the catalyst. I believe that a move below the 0.68 level would probably open up the door down to the 0.67 handle, maybe even lower than that.

All things being equal I think this is a pair that continues to cause quite a few problems as although it has been very bullish over the last three days, it is most certainly in an extraordinarily bearish trend. All it is going to take is some type of negative news coming out of the US/China situation to get this thing falling apart. After all, that is a scenario that continues to cause a lot of headaches out there and I think that will continue to be the case going into the future. In fact, some analysts are now starting to admit that the likelihood of a deal between 2020 elections in the United States are almost impossible.

It’s likely that we may get a bit of a relief rally with risk appetite, but ultimately it’s probably going to wax and wane quite rapidly due to something coming out on Twitter, perhaps a headline in Beijing, or who knows what next. Because of this you need to keep your position size small but certainly the sellers are coming back.

Please let us know what you think in the comments below

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