AUD/USD Weekly Price Forecast – Australian dollar continues to meander
The Australian dollar has gone back and forth during the course of the week as we continue to meander around the 0.70 level. That is an area that is crucial for the markets, as it forms a massive amount of support that extends down to the 0.68 handle. That’s an area that should continue to be very difficult to break down through, so at this point if the US dollar starts to strengthen I would be a bit cautious about trying to short this market. This isn’t to say that we can break down, but what it does suggest is that it is the path with most resistance to movement.
AUD/USD Video 13.05.19
On the other hand, if we get a POP higher, probably due to some good news coming out of the US/China trade talks, the Australian dollar will more than likely rally significantly. I would anticipate a move to the 0.70 level, and possibly even higher than that given enough time. Clearing the 0.7250 level opens up a move to much higher levels and perhaps is the first sign of the trend changing longer term.
Speaking of which, I do believe that’s essentially what we are trying to do, change the trend overall. This is a bottoming pattern that is taking quite some time to form, but that’s quite common. What we need to see is good news involving China in order for the Australian dollar to do well as it represents the Australian economy, which of course supplies China with its raw materials. The two economies are intertwined, so therefore you should think of it as such.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
