The Australian dollar initially pulled back during the week, but then turned around to form a bit of a hammer. The hammer of course is preceded by another hammer, and that being the case it’s very likely that we are going to try to rally from here. The 0.70 level above is major resistance, and if we can break above there then it would be an extraordinarily bullish sign for the Aussie dollar. However, keep in mind that the Australian dollar is highly sensitive to the US/China trade situation. After all, Australia is a major supplier of commodities to China.
AUD/USD Video 03.06.19
Looking at this chart, if we can break above the 0.70 level I think that the market probably goes to the 0.7 to the range. If we can get some type of good news out of the US/China trade situation, then the Australian dollar should do quite well. On the other hand, if the market breaks down to reach the 0.68 level, some type of negativity out of that situation could crush this market and send it down to the 0.65 handle.
I think we are trying to form some type a bottom, but it’s going to take a long time to get there. I believe that the market is probably best left alone until we can break out of this range that we are in. Once we do, then we should get quite a bit more clarity as to where we are going next.
Please let us know what you think in the comments below
This article was originally posted on FX Empire