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Australian Dollar vs US Dollar Weekly Technical Analysis
The Australian dollar has gone back and forth during the course of the last week, as the 0.64 level continues to be a major resistance barrier. Underneath, the 0.63 level is offering a bit of support, and therefore I think you get a situation where we are just simply bouncing around. All things being equal, this is a market that I think continues to see a lot of volatility, but I still believe that this is a “fade the rally” type of market.
Keep in mind that the Aussie is highly sensitive to global risk appetite, which of course is something worth paying attention to. The US dollar will continue to attract a lot of attention in the currency markets, as there are a lot of problems out there when it comes to the idea of geopolitical concerns, and of course more specifically the Middle East. Furthermore, the interest rates in America continue to attract a lot of inflows, so I think it all ties together quite nicely for a continuation of the downtrend.
If we break down from here, the 0.62 level is an area that has attracted some support in the past, I think it’s probably only a matter of time before we see that tested. A breaking of that level to the downside opens up the possibility of a move down to the 0.60 level. If we break down below that level, then it’s likely that we break down quite drastically. If we rally from here, then the 0.65 level is a major resistance barrier, and if we break above there, then it opens up the possibility of a move to the 0.66 level. I don’t see that happening, but it is a threat that you need to be cognizant of.
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