The Australian dollar has initially fallen during the trading session on Friday, breaking down towards the 0.66 handle. However, we have bounced quite nicely from there as the Manufacturing PMI figures in the United States had missed the anticipated levels. Having said that, the Australian dollar might be a bit oversold, but I think at this point it’s a nice opportunity to sell at higher levels. The 0.67 level is an area that should show quite a bit of resistance, and it does look very likely that the market tries to go down to the 0.63 handle eventually, as it is the bottom of the overall consolidation from back during the financial crisis. Yes, we have reached that low in the Aussie dollar.
AUD/USD Video 24.02.20
That being said, the market breaking above the 0.6750 level could open up the door to hire trading, perhaps even the 0.70 level. I don’t think that’s going to happen anytime soon though, but it is something that we should be paying attention to as a possibility. At this point, the market is one that you need to short in order to “by the dollar on the cheap”, as it is a highly sought after currency right now. If we break down below the candlestick for the trading session on Friday, then the market will just simply continue to fall. The Aussie can’t get out of its own way, which makes sense considering that it is so highly sensitive to the Chinese economy. With that, I remain bearish, but I recognize we may get an opportunity to start selling from higher levels as momentum may be found after some type of move.
This article was originally posted on FX Empire
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