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Australian Dollar vs US Dollar Weekly Technical Analysis
The Australian dollar initially shot higher during the course of the week, but found enough resistance near the 0.6750 level, before breaking down rather drastically. After all, the RBA chose not to raise interest rates this past week, and therefore it sent the Aussie plunging. However, the jobs number on Friday has disappointed as far as jobs added, so we’ve seen the US dollar get hammered. The 0.66 level continues to be important, so to be interesting to see whether or not we can stay above it.
All things being equal, I think we continue to see a lot of sideways action in general, but I also believe that it favors the downside. I think it’s going to be difficult for longer-term traders to make any real money in this market, but when you get short-term rallies, you probably start selling short-term signs of exhaustion. The 50-Week EMA sets just above the candlestick, and therefore it’s likely that we continue to see choppiness.
If we do break above the 50-Week EMA, then it’s likely that we could go looking for the 0.69 level, which is an area where we’ve seen a lot of trouble previously, where the double top hat form. I just don’t see that happening, but it is something that you need to keep in the back of your mind. Interest-rate differential still favors the US dollar, albeit somewhat slightly. In other words, I don’t even think there’s any type of interest rate differential play here, I think it’s just an opportunity to trade whether or not the commodity markets are going to rally, or if there’s going to be growth out there.
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