- During the trading session on Thursday, we have seen the Australian dollar skyrocket higher against the US dollar, as it looks like we are ready to continue seeing quite a bit of bullish pressure in this market from what I can tell.
- All things being equal, this is a market that has been trying to build up enough pressure to break out.
- It looks as if people are starting to pay close attention to tariff concerns easing between the Americans and Chinese, and that of course has a major influence on what happens with the Australian economy.
- Whether or not that has any real legs going forward remains to be seen, but it is worth noting that this is a significant breakout.
Technical Analysis
It’s worth recognizing that a consolidation area has been broken to the upside, and I think that does help give us a potential target. After all, you could look at the 200 Day EMA as being close enough to the 0.65 level for the “measured move.” That being said it doesn’t necessary mean that the Australian dollar is my favorite currency to own, but I do recognize it has a real shot at trying to rally from here. On the other hand, if we were to turn around and break down below the 50 Day EMA, that would be horrible for the Australian dollar, and it’s likely that we would plunge toward the 0.62 level rather quickly.
I believe at this point in time you can expect a lot of noise and drama, and let’s be honest here, we are only one tweet away from sending the markets into some type of panic. However, it certainly looks as if somebody knows something here, because people lie, numbers don’t. With this, I am not willing to short the market at the moment, and if I were to take a short-term trade, I would actually be aiming for the upside. The 200 Day EMA will end up making the longer-term decision for me, as well as the way the US dollar is behaving against multiple other currencies.
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