- The Australian dollar has rallied rather significantly during the trading session on Tuesday as it looks like we are betting on the United States dollar collapsing again.
- This has been a very strong turn of events, but really not on any serious news other than CPI dropping a little more than anticipated, but nothing major.
- So, with that being the case, I think we've got a situation where traders are still in the same basic range that we've been in.
- And while the US dollar has fallen against some other currencies, the Australian dollar seems to be standing out, as it was so strong at this point in time.
Longer Term Charts
When you look at the weekly chart, you can see we're in an area that's just destined to be noisy. So, one thing that I would look at is the 0.65 level. If we can break above there on a daily close, then maybe the Aussie has room to run to the 0.67 level.
Top Regulated Brokers
On the other hand, if we break down below the 50 day EMA, it's possible that the Aussie could drop to 0.62. At this point, I still don't like this currency pair really to be traded at all other than the short term sideways action. The Australian dollar of course is highly levered to the Chinese economy. And therefore, I think you've got a scenario where “as goes China, so goes the Aussie economy.”
Part of this I probably a little bit of excitement for the trade deal or potential trade deal between the United States and China coming around, which should help the Chinese economy, which has been under extreme pressure. So, with that being said, I think you still have some questions to ask, but we do have a couple of important levels to follow.
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