Australian Dollar Pulls Back Towards Potential Support
The Australian dollar has pulled back a bit during the trading session on Tuesday to reach down towards what could be an uptrend line for an ascending channel, which in and of itself will attract a lot of attention. With that in mind, I will be paying close attention to the 0.7150 level, because if we break down below that level it is likely that the Australian dollar struggles going forward. All things been equal, this is a market that I believe will pay close attention to the 50 day EMA just below, and therefore I think you need to pay close attention to that level as well.
AUD/USD Video 19.01.22
If we can break above the 50 day EMA, it would be a bullish sign and could get this market moving to the upside. However, if the market were to break down below that 0.7150 level, I suspect that you will see US dollar strength across-the-board. Because of this, I believe that we probably have an opportunity to make a bigger trade, and to the upside if we can clear that shooting star from last week, it opens up a much bigger move.
Keep in mind that the Australian dollar is highly sensitive to risk appetite, so you will have to pay close attention to what is going on around the world, but at this point in time it looks as if the fear has come back so I believe that the downside is probably going to be easier, but I need some type of confirmation in order to put money to work at this point.
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