The Australian dollar has rallied a bit during the trading session on Thursday, as we continue to see a lot of back and forth in the same area. That being said, the 50 day EMA is sitting just above, and it is an area that should continue to cause a little bit of resistance, but if we were to break that level, I think there is plenty of resistance above there as well. In fact, I think between here and the 0.78 level is an area that could and will continue to cause significant issues.
AUD/USD Video 09.04.21
I think it is only a matter of time before this market find significant selling, even though the narrative right now is about the “reopening trade”, and therefore people are expecting this to rise, but price is king, and we have seen a couple of shooting stars in a row on the monthly chart. This sets up an interesting conundrum, because if we were to turn around a break above the 0.80 level, then we could go much higher.
Until then, I think this market is going to continue to struggle but a move above the 0.78 level would have me looking for a move towards the 0.80 level. If we break down below the 0.76 level, then the market is likely to break down towards the 0.71 level, which although it sounds rather drastic, would simply be a correction and what has been a very bullish market over the last year or so. That being said, it seems as if the market is trying to build up pressure to go in one direction or the other.
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