The Australian dollar has gotten absolutely hammered during the trading session on Thursday, breaking the 50 day EMA and screaming towards the 0.6775 handle. That’s an area that could see a little bit of support, and most certainly we have a lot of support underneath at the 0.67 handle. This was in result of a very poor employment figure, which shocked the world trading community. At this point, it makes sense that the Australian dollar would get crushed as a result, especially as the US dollar is fairly strong anyway.
AUD/USD Video 15.11.19
I suspect that a lot of the job losses have to do with the US/China trade war, which continues to be a major thorn in the side of the Australians. As long as that trade war continues, it’s difficult to imagine a scenario where Australia will be “in the clear” of any peripheral damage. Ultimately, I think that this market probably will continue to struggle to find its footing, and this latest announcement certainly doesn’t help. It did look like it was trying to form a bottoming pattern, if we do get some type of move forward between the Americans and the Chinese, these employment figures will soon be forgotten. However, these employment figures drive home exactly how damaging the trade war is going to be to some peripheral countries, with Australia being a specifically interesting one due to the fact that it is so highly levered to China. In a sense, Australia is probably more sensitive to the trade war than China itself.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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