- The AUD/USD has fallen a bit during the trading session on Thursday, but it looks as if it is trying to find some type of support near the 0.65 level.
- At this point, I think that a little bit of a recovery does make a certain amount of sense, with the 0.67 level above being massive resistance.
- Ultimately, I think that level is going to be very difficult to break above, and therefore it’s likely that the “market memory” comes into the picture as we had formed a bit of a “double bottom” in that area, and it is also an area that has been important multiple times.
The 0.67 level is an area that has been important for quite some time, going back several years. At this point in time, that should have a lot of interest attached to it. I do think that we are a little oversold, so the idea of a bounce makes quite a bit of sense. Nonetheless, the overall attitude of markets around the world will continue to see this market is one that will be important, therefore a significant signal as to what’s going on in Asia. Furthermore, the US dollar interest rate market has a lot to say as well, which is of course overdone.
Market Likely to be Skittish
I think at this point, we probably have a bit of a bounce heading into the weekend as people trying to take advantage of profit being made, and therefore it’s likely that they want to go into the weekend positive. Nonetheless, I think it’s only a matter of time before we get some type of exhaustive candle that we get short on. If we were to start buying this market, I would not be until we break above the 50-Day EMA at the very least. Even then, I would be a bit cautious, but I would need to see some type of shift or pivot coming from the Federal Reserve. This has very little to do with the Australian central bank, and everything to do with America.
Keep in mind that the market is going to continue to be very skittish, and of course continue to look at the US dollar as an opportunity to find cheap dollars given time. I do believe that the Australian dollar could go down to the 0.60 level, but that’s not something that’s going to happen overnight.
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