The Australian dollar has rallied a bit during the course of the trading session on Wednesday to show signs of life yet again. Ultimately, the 0.76 level is an area that I think will be crucial due to the fact that it was previous support, so if we can recapture that, this makes this a bit of a “throw over” as the buyers will have saved the market. The 200 day EMA will also have offered a bit of support, so I think at this point in time it is likely that we will continue to see a lot of questions asked.
AUD/USD Video 24.06.21
Quite frankly, I think this has more to do with the US dollar than the Aussie dollar itself, so pay close attention to the US Dollar Index. If it continues to fall, that could help quite a bit in order to push this market higher, driving the Aussie towards the 50 day EMA and then perhaps even higher than that. I have no interest whatsoever in shorting this pair right now, at least not until we break down below the recent lows. If we do, that could send this market much lower, as it would wipe out the rest of support.
At that juncture, I would anticipate that we would probably go down to the 0.71 handle. You should also keep in mind that the Australian dollar is highly correlated to commodities and the global growth picture in and of itself, so it does make quite a bit of sense that we should watch commodity markets as well to give us an idea as to where we go next.
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