The Australian dollar has gone back and forth during the course of the trading session on Monday as we essentially have nowhere to be. At this point, we are looking at the 0.76 level as a bit of a magnet for price, so it will be interesting to see whether or not we make some type of bigger move. I do think it is only a matter of time before we have to make the bigger move. Recently, we had seen a couple of shooting stars on the monthly candlesticks, so that does tell me that there is quite a bit of resistance above.
AUD/USD Video 13.04.21
Ultimately, I am looking to fade this market on signs of exhaustion, but I have to keep an open mind as we are most certainly in an uptrend. I do not necessarily think that the market is going to suddenly melt down Dan fall apart, but a significant pullback could be in the works. This will be especially true if yields in America continue to rise overall. That makes the US dollar much more attractive, as yield differentials continue to spread.
Ultimately, this is a market that I think could pull back towards the 0.70 level and still retain the longer-term uptrend. There are certainly a lot of things out there that could cause issues right now, so do not be surprised at all to see this market break down. On the other hand, if we break above the 50 day EMA, we will then go looking towards the 0.78 handle, another area that could be potential trouble as well. For a longer-term “buy-and-hold” type of move, we need to break above the 0.81 handle to really get going.
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