The Australian dollar has spent most of the week gaining ground against the greenback, as the US dollar has sold off against most currencies. That being said, the market is likely to continue to be very noisy, and I do think that it is probably quite likely that we get choppy behavior over the next couple of weeks. With this being the case, I think the market is one that you need to be somewhat cautious with, because quite frankly it is going to be difficult to hang on to the volatility.
AUD/USD Video 17.01.22
That being said, if we can take out the top of the weekly candlestick, then it is a good sign and I think we go looking much higher, perhaps towards the 0.75 level. On the other hand, if we break down below the bottom of the weekly candlestick, then a return to the 0.71 level, followed by the 0.70 level makes a lot of sense. Keep in mind that this is being thrown around more by the US dollar than anything else at the moment, so it is worth paying close attention to the US Dollar Index.
The Chinese economic numbers have started to creep back up, showing signs of life again, certainly helps the Australian dollar in general, so I do think that it is probably only a matter of time before this could come into play as well. It will be interesting to see how this plays out, but I do think that it is probably only a matter of time before we get moving.
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