The Australian dollar initially tried to rally during the trading session on Thursday but then rolled over to stay within the consolidation that we have seen as of late. The Aussie of course is being held hostage by the US/China trade situation, as that seems to be going nowhere fast. With that being the case, it makes quite a bit of sense that we continue to struggle for upward momentum. That being the said though, if we were to break down below from here, it’s very likely that we will eventually reach towards the bottom of the hammer from a couple of weeks ago. Beyond that, I think that we are probably going to go looking towards the 0.65 level after that which of course is crucial on the longer-term charts.
AUD/USD Video 23.08.19
Keep in mind that the US dollar of course has continued to attract a lot of attention as the US Treasury markets continue to be one of the favored trades for most desks out there. All things being equal, even if we did break to the upside I think that the 50 day EMA which is pictured in red on the chart will also offer quite a bit of resistance, so therefore I would be looking to fade any rally unless of course we get some type of an agreement between the Americans and the Chinese which seems all but impossible in the short term. Expect volatility but I would also expect that it’s going to be easier to fade rallies going forward.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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