Australian dollar explodes to the upside during the trading session on Wednesday

The Australian dollar of course has been negative for some time, and even though we had a nice rally, we broke below an uptrend line several days ago, and then again the previous session as far as the minor uptrend line is concerned. I think if we get interest rates rallying in the 10-year note, then the US dollar will return the strength. We also could see strength in the US dollar if we continue to see rising geopolitical tensions, and of course concerns coming out of the European Union.

I think that the 0.75 level will course be important, but at the end of the day it’s very unlikely that we will have a significant move in the short term, I think we continue to see a lot of choppiness in general, because the Australian dollar has the influence of gold, as it also can rally during geopolitical concerns. I think that the markets will continue to see difficult trading conditions. I think it is easier to short this market, as we have seen such a significant break down, and the bounce of course has been very important but also is short-term focused at best.

I think that the 0.77 level above continues to be massive resistance, and the uptrend cannot begin in earnest until we break above that level. In general, I think that the US dollar continues to strengthen over the summer, but it had gotten ahead of itself against many other currencies, so perhaps that’s part of what we are seeing here.

AUD/USD Video 31.05.18