The Aussie dollar is trying to do something at this level, but the overall attitude is worth noticing, as the Australian dollar has been a bit more resilient than many other currencies against the Greenback.
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The Aussie dollar has rallied a bit during the course of the trading session here on Tuesday, testing the 200-day EMA. This is an area that a lot of people will be watching, from a technical analysis standpoint.
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Part of this is going to be due to the fact that U.S. interest rates started to drift a little bit lower, and that, of course, helps the market try to get away from the U.S. dollar as the interest rate differential shrinks.
If the market were to break above here
From a technical analysis standpoint, you can see that the 200-day EMA is offering a little bit of a barrier near the 0.6980 level. If the market were to break above here, then I'll be watching the 50-day EMA, which is where we had previously seen a little bit of selling pressure near the 0.7050 level.
The Aussie dollar has been consolidating for most of the year between 0.6850 on the bottom and the 0.7250 level on the top. The moving averages, both the 200-day EMA and the 50-day EMA, look a little lackluster.
I think once we start to see a little bit of momentum to the upside, it then lends itself to perhaps trying to get to the top of the range. If we were to break down below the 0.6850 level on a daily close, then things change. That probably would be accompanied by U.S. dollar strengthening around the world, U.S. rates rising, and, of course, maybe something Australia-related as well.
This is a market that has two banks that are somewhat hawkish. We'll have to see how this plays out.
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