Australian Dollar Continues to Reach Higher Levels

The Australian dollar has initially pulled back to test the 200 Day EMA during the trading session on Thursday, only to recover and break above the 0.7350 level. This is a market that continues to see a lot of volatility based upon not only commodities but risk appetite in general. All things being equal, this is a market that is going to continue to be very noisy, and therefore I think you will continue to see a lot of volatility.

AUD/USD Video 11.03.22

On the downside, the market then sees plenty of support at the 0.7250 level as well, so if we were to break down below there then I think we probably have a little bit more of a correction coming. On the upside, we have the 0.7450 level that offers a lot of resistance that extends all the way to the 0.75 handle. In general, this is a market that continues to be noisy and volatile, meaning that you need to keep your position size relatively small.

I anticipate that the market will continue to see a lot of magnetism to the 200 Day EMA and therefore I would anticipate more chop than anything else. Keep in mind that as we head into the weekend people might be a bit concerned about holding on to risk assets, so that might cause a little bit of noise at the end of the Friday session. Either way, this is all about keeping your position size relatively small, so you need to be cautious due to the fact that headlines can cross the wires at any time to throw the market into disarray.

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