The Australian dollar fell a bit during the day on Thursday, reaching down towards the 0.75 zero level underneath. We bounce from there, but I think
The Australian dollar fell a bit during the day on Thursday, reaching down towards the 0.75 zero level underneath. We bounce from there, but I think overall, we are going to continue to see quite a bit of volatility and negative pressure in the Australian market, as the risk off attitude continues. There are a lot of concerns with the Korean Peninsula currently, and that works against the Australian dollar as it is a proxy for Asia itself in currency markets. I think the given enough time, we will go looking towards the 0.7750 level underneath, which was previously resistive. It has not been retested, so this is a perfect technical move.
I’m continuing to sell short-term rallies that show signs of exhaustion. Once that happens, I believe that adding to an already short position is probably the best way to go. I think that given enough time we will test the 0.7750 level, which could be very bullish and supportive. Because of this, I’m not calling for some type of massive meltdown, I just believe that we are pulling back to a more substantial level underneath, where we can continue to find a bit more support for the longer-term move. After all, the 0.80 level above is important on charts going back decades, so it’s not a surprise that we couldn’t get above it’s the first time. If we could breakout above there, it becomes more of a “buy-and-hold” situation, but I don’t see that happening anytime soon, and we most certainly will have to bring quite a bit of momentum to the market to take advantage of that break out and continue to go even higher. Ultimately, I think that the next couple of sessions will continue to see softness, even if gold rallies as gold is picking up due to fear, not speculation.
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.