The Australian dollar broke down significantly during the trading session on Wednesday, as we have reached an area that has started to see buyers in the US session. I believe at this point it’s very likely that we are going to see a bounce coming soon, somewhere near the 0.71 level. I think the market will more than likely find plenty of reason to go higher if we can get good news coming out of the US/China situation. Remember, this is the Lunar New Year in Asia, so the Chinese aren’t even going to be influential at this point.
AUD/USD Video 07.02.19
I do think that the 0.70 level is a massive area of support that should extend down to the 0.68 level. That is a massive “floor” in the marketplace and I think that it is only a matter time before value hunters come back into the marketplace. If we can get good news coming out of the US/China situation, that should significantly change the attitude of this market if we can get some type of good news. If we do, I suspect that the Australian dollar will take off to the upside as it is not only sensitive to the Chinese situation, but it is also on the other side of the trade from the US dollar, which has a softer Federal Reserve standing behind it. As we have fallen so far during the day on Wednesday, I am now looking for supportive candles to start buying as we have gotten back to what I would call the value zone.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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