AUD/USD Price Forecast – Australian Dollar Rallies to Kickoff WeekAussie dollar traders started to buy hand over fist on Monday as the Chinese government stoke the fires of the bullish run in Chinese equities.
The Australian dollar rallied a bit during the trading session on Monday to kick off the week with a certain amount of strength, due to the Chinese equities starting off the week rather strong. This was based upon statements coming out of the government, so read into that which you will but at the end of the day the Australian dollar is overly sensitive to China in general. With that, if China does better, so does the Aussie dollar.
AUD/USD Video 07.07.20
Having said that, the area between 0.70 and 0.71 is extraordinarily resistive, so it is not like we are simply going to slice right through there. With that, I would assume that there will be multiple pullbacks before we get some type of major breakout, but if we do manage to get above 0.71, it is likely that the market will become more of a “buy-and-hold” type of rally. After all, that would wipe out a major sell off in this market, and thereby show extreme amounts of strength.
Trading Derivatives carries a high level of risk to your capital and you should only trade with money you can afford to lose. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved, and seek independent advice if necessary. A Product Disclosure Statement (PDS) can be obtained either from this website or on request from our offices and should be considered before entering into a transaction with us. Raw Spread accounts offer spreads from 0.0 pips with a commission charge of USD $3.50 per 100k traded. Standard account offer spreads from 1 pips with no additional commission charges. Spreads on CFD indices start at 0.4 points. The information on this site is not directed at residents in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
If we do pull back, anticipate that the 0.68 level should be supportive, because it has proven itself to be so several times over the last couple of weeks. I think at this point it is difficult to get overly excited about some risk assets like the Aussie, because there are so many different things going on at the same time that could cause absolute chaos. With that, if I were forced to make a trade here, I would assume that a pullback is coming, and a breakout seems very unlikely. This does not mean that you cannot buy the Australian dollar, just that you are playing with fire all the way up here.
For a look at all of today’s economic events, check out our economic calendar.