The Australian dollar has fallen again waiting for the Federal Reserve interest rate decision, as we continue to see a lot of downward pressure on this pair. That makes quite a bit of sense as the US/China trade relations, although a bit more congenial lately, hasn’t really changed much. With that being the case it’s likely that the US dollar will continue to pick up against the Australian dollar which is so highly sensitive to the Chinese economy. In fact, the Aussie dollar is quite often used by traders as a proxy for China, so keep all of that in mind when watching this pair.
AUD/USD Video 19.09.19
To the downside I see the 0.68 level as offering a significant amount of support, so that would be your initial target on a break down. Below there, the market could very well go down to the 0.67 handle, and then perhaps even lower. We had recently tested the 50% Fibonacci retracement level of the most recent selloff and have failed so far. That signifies that we could continue to go lower as per usual trading. However, if we do break above the 0.69 level, then we will probably go looking towards the 61.8% Fibonacci retracement level which is just above there anyway. In other words, I remain bearish of the Australian dollar but I also recognize that we have been in a bit of a “holding pattern”, as the US/China trade situation has at least calm down. Wait for it though, something bad will happen.
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This article was originally posted on FX Empire
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