The Australian dollar initially pulled back during the trading session on Tuesday but did find a bit of buying underneath the 0.65 zero level to show signs of life. If we do end up closing this candle as a hammer, that’s obviously a very strong sign but ultimately I believe that the market is only going to continue to go back and forth in 50 pip ranges, perhaps breaking above the top of the candle stick could free the market to go to the 0.69 level above. However, if we break down below the bottom of the candle stick we will then test the major support level in the form of the 0.68 handle.
AUD/USD Video 19.06.19
That being said, I think that we are simply looking to go back and forth as we continue to wonder about the US/China trade relations, which seem to be going nowhere. Until that gets resolved, this pair will continue to be very choppy and difficult, because the Australian economy is so highly levered to the Chinese mainland economy. With that in mind, I look at short-term charts for opportunities, and as recently mentioned, I use 50 pip levels to set stop losses and take profits. It is because of this that I would be more than willing to take profits if we get close to the 0.69 level on a rally, but if we were to break down below the 0.68 level, this market could unwind quite drastically.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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