The main range is .7082 to .6671. It retracement zone at .6877 to .6925 is controlling the near-term direction of the AUD/USD. This zone is now resistance.
Crossing to the weak side of the main Fibonacci level at .6567 will indicate the selling is getting stronger.
Based on the events over the weekend with the spreading of the coronavirus, we’re expecting to see a lower opening.
For a few weeks, I’ve advised readers that the current pullback is nothing more than a healthy mid-cycle consolidation. That once concluded, metals and miners would continue higher into March. The correction period is ending, and the next leg higher is about to begin. We see explosive potential in silver.
Gold markets initially pulled back during the trading session on Friday to find value and then turned around and show strength. Ultimately, it looks as if gold is ready to take off again.
The US dollar has done very little against the Japanese yen, as the market tried to rally a bit, but at this point it looks very sluggish and like it’s going to struggle to go anywhere significant in the short term.
The British pound broke above the highs of the previous session on Thursday, but then turned around to show signs of weakness. At this point, the market is likely to grind back and forth but I think the most important thing to pay attention to is that we have a lot of support underneath.
The British pound initially tried to rally and recover some of the losses from Thursday on early Friday but has turned around to show signs of weakness. At this point, the British pound looks likely to continue to grind back and forth but overall, I do think that it is a buying opportunity just waiting to happen.
The Euro initially tried to rally during the trading session on Friday, but then gave back some of the gains yet again. Ultimately, this is a market that looks as if it is going to go looking towards the major figure underneath.
The Australian dollar went back and forth during the trading session on Friday, as we continue to dance around the previous downtrend line. This sets up an interesting trade opportunity though, as we have a couple of clear levels.
Gold markets initially fell during the week, but then turned around to break higher. Ultimately, this is a market that continues to grind sideways in this general vicinity, as it was the high that the market initially hit from the initial surge to the upside.
The US dollar pulled back a bit during the week against the Japanese yen, as we are now likely to test the ¥109 level. That being said, there should be plenty of support just below as well.
The British pound rallied a bit against the US dollar during the week, breaking above the 200 week EMA, and using a major uptrend line as a crutch.
The British pound rallied again during the week, breaking above the 200 week EMA before given back quite a bit of the gains. By doing so, the market has formed a bit of a shooting star, suggesting that perhaps we may have to pull back.
The Euro initially tried to rally during the week, but then broke down rather significantly. It looks as if we are trying to test the bottom of the recent consolidation.
The Australian dollar initially tried to rally during the week, but then reached towards the previous downtrend line. Ultimately, the market is approaching the 0.68 level is a sign of challenging support.
Based on the early price action and the current price at 1.1039, the direction of the EUR/USD is likely to be determined by trader reaction to the Fibonacci level at 1.1045.
With over 30 million people quarantined in China and 10 cities on lockdown, the Chinese economy may come to a standstill over the short-run. This includes those who were likely to purchase gold during the Lunar New Year holiday.
The U.S. has long criticized EU trade policies, such as its restriction on U.S. farm exports. With the U.S. and China signing a trade deal, Washington can now focus on the EU, and that could spell bad news for Brussels.
Today’s price action suggests Aussie and Kiwi investors may be afraid to take a chance holding on to long positions over the week-end due to the fear and uncertainty over the Chinese virus.
Conditions could change late in the session as investors decide whether to hold risky stock positions over the weekend.